Wix.com Limited (WIX) stock, after an uneventful IPO, has risen by more than 50% in the last few weeks. Bullish investors are banking upon continuation of strong revenue growth rates. They have high hopes that this "cloud" story with high gross margins would eventually start generating profit and justify the current high valuations.
There are broader concerns around the DIY (Do-It-Yourself) website building tools market in general and Wix in particular that may act as negative catalysts in the coming weeks and quarters. Some of these are
- Constant concerns around poor SEO (Search Engine Optimization) on the platform.
- Growth of Apps on iOS and Android to negatively affect the broader marketplace
- Lack of visibility on operating leverage
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