Wall Street Analysts See Wix.com (WIX) as a Buy: Should You Invest?

Group 1: Brokerage Recommendations for Wix.com - Wix.com has an average brokerage recommendation (ABR) of 1.52, indicating a consensus between Strong Buy and Buy based on 21 brokerage firms' recommendations [2] - Out of the 21 recommendations, 14 are Strong Buy and 3 are Buy, accounting for 66.7% and 14.3% of all recommendations respectively [2] - Despite the positive ABR, caution is advised as studies show limited success of brokerage recommendations in predicting stock price increases [3][8] Group 2: Limitations of Brokerage Recommendations - Brokerage firms often exhibit a strong positive bias in their ratings due to vested interests, leading to a disproportionate number of favorable ratings compared to negative ones [4][8] - The interests of brokerage firms may not align with those of retail investors, providing little insight into future stock price movements [5] - Analysts' recommendations are often overly optimistic, which can mislead investors [8] Group 3: Zacks Rank as an Alternative Indicator - Zacks Rank categorizes stocks into five groups based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements [6][9] - The Zacks Rank is updated more frequently than the ABR, making it a timely tool for predicting future stock prices [10] - Wix.com currently holds a Zacks Rank 3 (Hold), with an unchanged consensus earnings estimate of $5.85 for the current year [11][12]