Overall WIX gets a fundamental rating of 5 out of 10. We evaluated WIX against 88 industry peers in the IT Services industry. Both the profitability and the financial health of WIX get a neutral evaluation. Nothing too spectacular is happening here. WIX is growing strongly while it is still valued neutral. This is a good combination!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

WIX had positive earnings in the past year.
WIX had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: WIX reported negative net income in multiple years.
Each year in the past 5 years WIX had a positive operating cash flow.

1.2 Ratios

The Return On Assets of WIX (5.43%) is better than 69.32% of its industry peers.
The Return On Invested Capital of WIX (6.66%) is better than 65.91% of its industry peers.

		Industry Rank	Sector Rank
ROA	5.43%
ROE	N/A
ROIC	6.66%

ROA(3y)-5.03%

ROA(5y)-5.92%

ROE(3y)N/A

ROE(5y)N/A

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With a decent Profit Margin value of 7.20%, WIX is doing good in the industry, outperforming 75.00% of the companies in the same industry.
WIX's Operating Margin of 5.72% is in line compared to the rest of the industry. WIX outperforms 59.09% of its industry peers.
WIX's Gross Margin of 68.45% is amongst the best of the industry. WIX outperforms 89.77% of its industry peers.
WIX's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	5.72%
PM (TTM)	7.2%
GM	68.45%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y3.36%

GM growth 5Y-1.77%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WIX is destroying value.
The number of shares outstanding for WIX has been reduced compared to 1 year ago.
The number of shares outstanding for WIX has been increased compared to 5 years ago.
Compared to 1 year ago, WIX has an improved debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 1.77, we must say that WIX is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of WIX (1.77) is worse than 61.36% of its industry peers.
WIX has a debt to FCF ratio of 2.09. This is a good value and a sign of high solvency as WIX would need 2.09 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.09, WIX is doing good in the industry, outperforming 69.32% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	N/A
Debt/FCF	2.09
Altman-Z	1.77

ROIC/WACC0.81

WACC8.25%

2.3 Liquidity

WIX has a Current Ratio of 1.62. This is a normal value and indicates that WIX is financially healthy and should not expect problems in meeting its short term obligations.
WIX has a Current ratio (1.62) which is in line with its industry peers.
WIX has a Quick Ratio of 1.62. This is a normal value and indicates that WIX is financially healthy and should not expect problems in meeting its short term obligations.
WIX has a Quick ratio (1.62) which is in line with its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.62
Quick Ratio	1.62

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

WIX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 30.99%, which is quite impressive.
The Earnings Per Share has been growing by 40.43% on average over the past years. This is a very strong growth
Looking at the last year, WIX shows a quite strong growth in Revenue. The Revenue has grown by 13.22% in the last year.
The Revenue has been growing by 18.37% on average over the past years. This is quite good.

EPS 1Y (TTM)30.99%

EPS 3YN/A

EPS 5Y40.43%

EPS Q2Q%12%

Revenue 1Y (TTM)13.22%

Revenue growth 3Y11.51%

Revenue growth 5Y18.37%

Sales Q2Q%13.61%

3.2 Future

Based on estimates for the next years, WIX will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.78% on average per year.
WIX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.25% yearly.

EPS Next Y7.12%

EPS Next 2Y3.58%

EPS Next 3Y9.51%

EPS Next 5Y11.78%

Revenue Next Year13.31%

Revenue Next 2Y13.72%

Revenue Next 3Y13.58%

Revenue Next 5Y12.25%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 11.17, the valuation of WIX can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of WIX indicates a rather cheap valuation: WIX is cheaper than 86.36% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 28.41. WIX is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 12.12 indicates a correct valuation of WIX.
Based on the Price/Forward Earnings ratio, WIX is valued a bit cheaper than 78.41% of the companies in the same industry.
WIX is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.64, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	11.17
Fwd PE	12.12

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as WIX.
Based on the Price/Free Cash Flow ratio, WIX is valued cheaper than 90.91% of the companies in the same industry.