Wix Stock Recovers Amid AI Growth and Analyst Optimism
Translated & summarized from Globes by baba
Wix's stock has recovered significantly from its lows, now trading around $77 after a volatile year that included a $1.6 billion share buyback and layoffs. Two investment banks, Cantor Fitzgerald and Oppenheimer, have issued positive ratings, citing strong growth from its Base44 acquisition and AI-driven products. Analysts believe the company is undervalued, with potential for further upside as its Base44 subsidiary gains traction and its core business remains profitable.
The story in 6 lines · by baba
- Wix stock has recovered to around $77, a significant rebound from its yearly low.
- Cantor Fitzgerald raised its price target to $90, citing growth potential and Base44's performance.
- Oppenheimer reinstated Wix with an $85 price target, highlighting its user base and ARR.
- Wix acquired Base44, which is now a key growth driver and nearing profitability.
- The company announced layoffs of 20% of its workforce in May due to economic factors and AI development.
- Analysts believe Wix's stock is significantly undervalued compared to industry peers.
Wix's stock has experienced significant volatility this year. In March, the Israeli internet company controversially repurchased its own shares for approximately $1.6 billion at $92 per share. Following this, the stock plummeted by over 50% to a yearly low of around $40, attributed to a broader downturn in SaaS stocks influenced by AI advancements. The stock has since doubled, now trading around $77, reflecting a 3.25 billion dollar valuation and a 26% decrease year-to-date. This recovery is partly due to a rebound in software stocks.
In May, Wix announced the layoff of 20% of its workforce, about 1,000 employees. The company cited the shekel-dollar exchange rate's impact on costs and the need for greater efficiency due to AI development as reasons for the layoffs. Despite these challenges, two investment banks have recently issued positive recommendations for Wix's stock.
Wix, led by CEO Avishai Abrahami, enables users to create and manage websites. In 2025, it acquired Base44, founded by Maor Shlomo, which allows users to build digital creations using natural language without coding. Base44 has become a significant growth engine for Wix, launching its own language model, Base1. Wix reported that Base44, which had near-zero gross profitability in early 2026, is projected to achieve 60% profitability in the second half of the year.
Deepak Mathivanan, an analyst at Cantor Fitzgerald, raised his price target for Wix to $90, an approximately 17% premium, maintaining an "overweight" recommendation. He anticipates that Wix's third-quarter earnings report will show growth upside in orders and revenue, citing a moderation in exchange rate headwinds and strong growth from Base44. Mathivanan expects the company's fourth-quarter forecast to indicate low double-digit growth year-over-year and anticipates management will provide further details on Base44's performance and 2027 strategy.
Oppenheimer analysts also reinstated Wix with an "overweight" recommendation and a $85 price target, a 10.4% premium. Analyst Sergey Vachonok highlighted Wix's 317 million registered users and nearly $2 billion in annual recurring revenue (ARR). He identified key growth drivers as the high-growth Base44 platform, the AI-powered Wix Harmony website editor, and the Wix Headless layer, which offers business infrastructure for sites and apps built with external AI tools. Vachonok noted that Base44's user acquisition rate is approaching Wix's own, and the Base1 launch is significantly reducing its costs. He compared Base44's valuation potential to its Swedish competitor Lovable, suggesting Base44 could be worth $1.5 billion or more, representing about 40% of Wix's total market cap without valuing its core profitable business. Vachonok believes Wix is undervalued compared to industry averages, despite concerns about AI's impact and its net debt position following the share buyback.
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