Please ensure Javascript is enabled for purposes of website accessibility

Why Stock Surged Today

By Joe Tenebruso - Feb 18, 2021 at 4:35PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investors are starting to take notice of the often overlooked e-commerce star.

What happened

Shares of (WIX 3.56%) soared on Thursday, following the website builder's excellent fourth-quarter results and multiple analyst price target hikes.

By the close of trading, Wix's stock price was up 13.9%. 

So what 

Wix's revenue jumped 38% year over year to $282.5 million. The website-creation platform added 185,000 net premium subscriptions in the fourth quarter, bringing its total subscriber count to 5.5 million as of the end of 2020. Wix's total registered user base, meanwhile, climbed 19% to 196.7 million. "The demand for a web presence is higher than ever before," CFO Lior Shemesh said in a press release. 

A person is holding an upwardly rising digital chart.'s shares rose sharply on Thursday. Image source: Getty Images.

To meet its users' urgent need for e-commerce tools, Wix is spending aggressively to develop new products and bolster its customer support services. These growth investments are weighing on Wix's profitability; it produced an adjusted net loss of $1.6 million. But Wix's free cash flow generation remained strong, to the tune of $23.1 million in the fourth quarter and a total of $129.2 million in 2020.

Now what

Wix co-founder and CEO Avishai Abrahami painted a tantalizing picture of Wix's future for investors. "Wix will now strive to become the main engine of the internet, democratizing access and providing a place where the majority of people will build their web presence," he said. "My goal and belief is that at this rate of growth, in the next 5-7 years, 50% of anything new built on the internet will be done on Wix."

Wall Street is buying into Abrahami's vision. On Thursday, Oppenheimer analyst Jason Helfstein and Wedbush analyst Ygal Arounian boosted their price forecasts for Wix's stock to $340 and $360, respectively.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned Stock Quote
$66.81 (3.56%) $2.30

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.