WIX IPO Valuation - Final

Congratulations to the folks at WIX on the completion of their IPO.  It was priced Wednesday at $16.50/share and closed yesterday at $16.56/share.  Our estimated valuation (assuming no exercise of the underwriters overallotment option) is an Enterprise Value of approximately $680 million, approximately 8x annualized revenues (based on the Q3 2013.) Their EBITDA is too low to produce a meaningful EBITDA multiple.

Wix is in the category of new shared hosters that have emerged over the last few years that feature an easy to use but advanced website design tool much like Weebly, SquareSpace, etc. These hosters offer use of their design tool for free and while some offer free basic hosting, all offer paid shared hosting services.  These services have been growing rapidly and represent one of the few strong growth sectors in shared hosting.

Please feel free to contact us if you have any comments, or questions.

Cheval Capital, Inc.

Disclaimer: This post is for general information purposes and is not meant to be taken as financial advice, a recommendation to buy or sell the stocks mentioned above, a comprehensive discussion of valuation or how to do the calculations discussed. Please be sure to consult your financial advisors when valuing your company, considering the sale of your business or making other financial decisions.

Wix - Estimated IPO Valuation - REVISED

REVISED: The values below have been adjusted to include the impact of outstanding in-the-money options and warrants.

The offering is expected during the week of 11/4/13.

Wix, an Israeli company that offers a free website design tool together with shared hosting, updated its IPO documents to include an estimated offering price range.  At the midpoint of this range, their Enterprise Value would be approximately $630 million or more than 7x annualized revenues (based on the Q3 2013.) (Their EBITDA is too low to produce a meaningful valuation.)

Wix is in the category of new shared hosters that have emerged over the last few years that feature an easy to use but advanced website design tool much like Weebly, SquareSpace, etc. These hosters offer use of their design tool for free and while some offer free basic hosting, all offer paid shared hosting services.  These services have been growing rapidly and represent one of the few strong growth sectors in shared hosting.

Please treat this as a very preliminary estimate as there are a number of assumptions in this calculation that can have a meaningful impact on the final valuation. (In particular, the valuation does not include exercise of the underwriters 15% overallotment option or the impact of outstanding Employee options.)  As we get more information we will update our estimates.

Please feel free to contact us if you have any comments, or questions.

Cheval Capital, Inc.

Disclaimer: This post is for general information purposes and is not meant to be taken as financial advice, a recommendation to buy or sell the stocks mentioned above, a comprehensive discussion of valuation or how to do the calculations discussed. Please be sure to consult your financial advisors when valuing your company, considering the sale of your business or making other financial decisions.