- RBC downgrades Wix.com (NASDAQ:WIX) to Sector Perform from Outperform. PT = $45 (vs. $45.29 close on Thursday).
- YTD, shares have dramatically outperformed the market, up over 97%.
- WIX has been a material outperformer in the internet sector this year. Given the steady improvement in WIX's fundamentals, firm believes the outperformance has been justified.
- However, with the stock now trading at 48X 2016E EV/Ebidta and 6.5X 2016E EV/Sales, among the highest in the sector, firm sees valuation upside as limited from here.
- More attractive risk/reward elsewhere in the internet small-cap sector.