We’re initiating coverage of Wix.com with a narrow moat rating and a $148 fair value estimate. Our fair value estimate implies a fiscal 2024 enterprise value/EBITDA multiple of 23 times and a P/E multiple of 25 times. At current levels, the shares look fairly valued, considering our High Morningstar Uncertainty Rating.
Wix is the leader in the SaaS CMS website building market, accounting for a third of new websites created in this market.
Customer retention in Wix’s target SMB market is challenging, given high business failure rates.
|
Metric
|
WIX
|
SQSP
|
GDDY
|
|---|---|---|---|
Price/Earnings (Normalized) | 43.18 | 71.78 | 38.37 |
Price/Book Value | — | — | 50.69 |
Price/Sales | 6.15 | 5.65 | 5.07 |
Price/Cash Flow | 31.62 | 37.23 | 22.27 |
|
Metric
|
WIX
|
SQSP
|
GDDY
|
|---|---|---|---|
Quick Ratio | 1.15 | 0.54 | 0.28 |
Current Ratio | 1.23 | 0.70 | 0.55 |
Interest Coverage | — | 1.70 | 3.86 |
|
Metric
|
WIX
|
SQSP
|
GDDY
|
|---|---|---|---|
Return on Assets (Normalized) | 15.49% | 9.56% | 28.00% |
Return on Equity (Normalized) | — | — | — |
Return on Invested Capital (Normalized) | 27.49% | 28.62% | 59.01% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
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