Fiverr International (FVRR 0.46%) shareholders beat the market this week as shares jumped 18% through 3 p.m. ET on Thursday. That's compared to a 2.1% rise in the wider market, according to data provided by S&P Global Market Intelligence.
The tech stock is still in deeply negative territory so far in 2022, down nearly 70%. However, improving investor sentiment has investors feeling more optimistic heading toward the company's next earnings update in a few days.
The main reason for Fiverr's stock-price rally this week is the fact that the Nasdaq Composite index, home to this and many other hard-hit growth stocks, soared. It jumped roughly 10%, pulling higher many battered stocks that had been sold down on fears of an impending recession.
Netflix reported better-than-expected news and projected a quick return to subscriber growth in the current quarter. That prediction suggests that investors might have been too quick to sell off many tech stocks on fears of slowing economic growth.
Investors will soon learn whether Fiverr is optimistic about its own growth prospects in the second half of 2022. The company issues its second-quarter results on August 4, and that announcement will reveal whether the "changing macro landscape" that executives described in May worsened further or stabilized as it has for Netflix.
Signs of strength would show up in faster sales growth than the 14% to 16% rate that management predicted, and in a potential upgrade to the 2022 outlook .
Volatility around demand on Fiverr's platform convinced the company to issue an unusually wide forecast for fiscal 2022, but the latest sales and profit trends will remove much of that uncertainty by early August. In any case, investors can expect the stock to continue to move in concert with broader investor sentiment shifts, just as it did this past week.