WIX - Embedded Expectations Analysis - 2018 05 17
Wix.com Ltd. (WIX:USA) currently trades at historical highs relative to UAFRS-based (Uniform) Earnings, with a 58.6x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about their free cash flow, marketing, and customer growthSpecifically, management may lack confidence in the sustainability of free cash flow improvements, and may be exaggerating their claim that their Q1 2018 user cohort will require very little additional marketing to generate revenue over the next 8 years. Also, they may lack confidence in their assertion that the brand will continue to get stronger, and may have concerns about the sustainability of developers bringing in their own customers through Wix Code
Wix.com develops and markets an internet service that allows users to create web content. Co. is a global web development platform enabling businesses and organizations to take their businesses, brands and workflow online. Co.'s core product is the Wix Editor, a drag-and-drop visual development and website editing environment complete with high quality templates, graphics, image galleries and fonts. With Co.'s platform, Wix registered users can create and manage a professional quality digital presence tailored to their business and brands' specific look and feel that is accessible across all major browsers and the most widely used desktop, tablet and mobile devices.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
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