This WordPress competitor is up 15% on Monday: here’s why
Wix.com Ltd (NASDAQ: WIX) is up roughly 15% on Monday after Starboard Value revealed to have taken a 9.0% stake in the web development services company.
Kevin O’Leary reacts to the news
Starboard said the cloud company was an “attractive investment” at the current valuation. Reacting to the stock market news, Kevin O’Leary (Mr Wonderful) said:
It’s a great outcome; I like it in a Wix situation. Bring in Jeff, bring in the team. Scrutinise every decision. Squeeze management’s head. That’s fantastic. We need more of this. This is good for the stock.
Wix.com Ltd, as per the activist investor, has potential to improve its margins. It’s in talks with executives on how to improve operations but is not after the board seats.
Analysts expect Starboard to lobby for cost-cuts and bigger buybacks.
Should you sell Wix stock on this rally?
Last month, Wix reported better-than-expected financial results for its second quarter and reiterated its commitment to hit 20% in free cash flow margin by 2025.
O’Leary is bullish on this stock for the long term and confirmed on CNBC’s “Halftime Report” that he had no plans of pulling out of this name on the rally today.
I believe in the mandate. This is a service that’s going to be around forever. The more you go cloud, the more you need Wix. This is a big index stock. It’s big enough market cap, good balance sheet. The growth on this name is phenomenal.
His constructive view is in line with Wall Street that also rates Wix.com Ltd at “overweight”.
The post This WordPress competitor is up 15% on Monday: here’s why appeared first on Invezz.