After Rallying More Than 700% in 2020, is Fiverr Still a Buy?

: fvrr | Fiverr International Ltd. News, Ratings, and Charts

fvrr – The global shift toward digital communications — companies‘ and individuals’ increasing willingness to adopt remote and flexible working arrangements — has helped shares of Fiverr International (FVRR) skyrocket in 2020. As the trend in remote work and entertainment activity is expected to continue, the company’s platform, which offers services across various categories, should continue to help it generate growth in revenue and earnings. So, the stock may still have plenty of upside left.

Headquartered in Tel Aviv, Israel, Fiverr International Ltd. (FVRR) operates an online global marketplace. Its platform enables sellers of services connect with buyers.  The company’s platform connects businesses with freelancers offering digital services across eight verticals, namely graphic and design, digital marketing, writing and translation, video and animation, music and audio, programming and technology, business, and lifestyle.

The stock has rallied more than 779% so far this year. With a global digital transformation now happening at an accelerated pace, the stock is expected to keep gaining in the coming months.

The stock’s impressive performance and its potential upside, which is based on a few factors, have helped the stock earn a “Strong Buy” rating in our proprietary rating system.

Here is how our proprietary POWR Ratings system evaluates FVRR:

Trade Grade: A

FVRR is currently trading above its 50-day and 200-day moving averages of $180.29 and $125.80, respectively, indicating an uptrend. Moreover, FVRR has gained more than 63% over the past three months, reflecting solid short-term bullishness.

The company’s top line has increased 87.8% year-over-year to $52.3 million for the third quarter ended September 30, 2020. This can be attributed to the company’s continued efficacy in driving new buyers to its platform. Active buyers on the platform increased 37% year-over-year to 3.1 million. And its gross profit increased 98.3% year-over-year to $43.6 million. An EPS of $0.12 surpassed the consensus estimate by 50%.

On November 18, FVRR announced that it expanded its international footprint in Latin America, with launches in Brazil and Mexico. By offering local payment solutions to users in countries, and with it the ability to communicate and interact in their native language, the company aims to drive more efficient buyer acquisition and conversion.

FYRE launched Fiverr Business on September 15. It is a subscription-based platform designed for corporate teams and departments to collaborate while managing projects with freelance contributors.

Buy & Hold Grade: A

In terms of proximity to its 52-week high, which is a key factor that our Buy & Hold Grade considers, FVRR is well positioned. The stock is currently trading 2.3% below its 52-week high of $211.36, which it hit on November 27th.

FVRR made its stock market debut in June 2019. The company’s growth can be attributed largely to the expansion of its geographic footprint.

Peer Grade: B

MercadoLibre, Inc. (MELI) and Jumia Technologies AG (JMIA) are two other popular stocks in the regional e-commerce space with operations worldwide. FVRR comfortably beat the returns of these popular industry participants over the past year. MELI and JMIA gained 185%, and 588.3%, respectively, over the same period.

Industry Rank: A

The e-commerce revolution began before the pandemic, which gave it a significant boost thanks to the stay-at-home arrangements in necessitated. Companies offering digital services are expected to gain in the coming months as remote services become the default arrangement, driven by changing consumer behavior. This industry is expected to grow post pandemic as more people acquiesce to the convenience that the e-commerce platforms provide.

Overall POWR Rating: A (Strong Buy)

FVRR is rated “Strong Buy” due to its short- and long-term bullishness, solid growth prospects, and underlying industry strength, as determined by the four components of our overall POWR Rating.

Bottom Line

FVRR has the potential to soar in the coming months despite gaining more than 779% so far this year, based on its continued business growth, favorable earnings and revenue outlook, and strong financials.

FVRR has an impressive earnings surprise history, with the company beating consensus EPS estimates in each of the trailing four quarters. The consensus revenue estimate of $256.69 million for the next year represents a 36.8% increase year-over-year. Its EPS is expected to grow at 156.7% next year. This outlook should keep FVRR’s price momentum alive in the near term.

Want More Great Investing Ideas?

“MUST OWN” Growth Stocks for 2021

Are Stocks Stuck @ 3,700

Top 12 Stocks for 2021

 


FVRR shares were unchanged in after-hours trading Tuesday. Year-to-date, FVRR has gained 775.96%, versus a 16.48% rise in the benchmark S&P 500 index during the same period.


About the Author: Manisha Chatterjee


Since she was young, Manisha has had a strong interest in the stock market. She majored in Economics in college and has a passion for writing, which has led to her career as a research analyst. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
FVRRGet RatingGet RatingGet Rating
MELIGet RatingGet RatingGet Rating
JMIAGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

Recession is Here...Watch Out Below!

More and more it looks like recession is here. This includes a dramatic decline for ISM Manufacturing discovered this morning. As you likely know, most economist call manufacturing the "canary in the coal mine" for the US economy as it often shows weakness before other areas. In fact, GDP Now from the Atlanta Fed reads it loud and clear with a negative revision for the US economy down to -2.1% for Q2. Ouch! We are going to discuss these new economic facts...what it means for the stock market outlook...and an interesting view on why the S&P 500 (SPY) does not decline in orderly fashion. All that and more is coming your way in this week's commentary…

:  |  News, Ratings, and Charts

4 Ideal Stocks to Add to Your Portfolio in July

While sluggish consumer spending data led to the stock market ending the last trading session of June in the red, a moderate inflation forecast is nurturing hopes over the economy to avoid a recession. Therefore, investors might consider buying quality stocks ARC Document Solutions (ARC), Core Molding Technologies (CMT), DLH Holdings (DLHC), and Friedman Industries (FRD) at their current low price levels to benefit from their big rebounds. Read more…

:  |  News, Ratings, and Charts

Stocks to Fall MUCH FURTHER this Bear Market Cycle

Spoiler alert...the bear market is not over. Unfortunately history shows that the S&P 500 (SPY) has much further to fall to squeeze out excess valuation. That is just a natural part of the bear market process that is properly explained in this timely market commentary. More importantly, this commentary provides a strategy on how to profit in the days and weeks ahead as the market finds its way to bottom. Read on below for more...

:  |  News, Ratings, and Charts

Wall Street Analysts Predict More Than 160% Upside in These Stocks

The high global inflation and hawkish federal reserve are leading to heightened volatility in the market. However, despite the market uncertainties, Wall Street analysts see a more than 160% upside potential in IonQ (IONQ) and Rigetti Computing (RGTI). Thus, these stocks could be ideal additions to your watchlist. Keep reading…

:  |  News, Ratings, and Charts

Stocks to Fall MUCH FURTHER this Bear Market Cycle

Spoiler alert...the bear market is not over. Unfortunately history shows that the S&P 500 (SPY) has much further to fall to squeeze out excess valuation. That is just a natural part of the bear market process that is properly explained in this timely market commentary. More importantly, this commentary provides a strategy on how to profit in the days and weeks ahead as the market finds its way to bottom. Read on below for more...

Read More Stories

More Fiverr International Ltd. (fvrr) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All fvrr News