In the company’s most recent earnings release, ContextLogic reported robust revenue growth of 76% year-over-year, beating analysts’ top-line expectations of $743 million. However, high marketing and sales costs led to negative margins and a large net loss: EPS of -0.21 vs. -0.18 estimated by Wall Street.
Since the inception of the pandemic, the local/physical-based commerce and retail businesses have also seen a shift towards the online and e-commerce platform. Consumers started preferring online e-commerce platforms due to increased convenience, efficiency, and access. This is exactly the spotlight in which Wish’s unique business could shine because it is based on an online personal and visual browsing experience adapted to give the same feeling as a normal physical retail store, through a mobile. To enhance this experience further, the Company has extended the review of its product’s quality to User-Generated-Content with over 85 million ratings and 10.5 million images-meaning that the customers customize the pictures for the brand description.
WISH STOCK PRICE
Context-Logic (Wish Stock) has been trading lower than 70% since its IPO price and all-time high price. With e-commerce being the future of the market, Wish can still achieve more than Wallstreet expectation. Short-term sellers and market being un-decided, wish has been beaten down to its all-time low stock price of $6.80.
This can be a long-term fundamental investment opportunity if you have the patient to wait for the long term. If the stock can trade again above $30, this gives about 200% ROI growth in our portfolio.
In the short term, this can be a risky stock and we recommend balancing your portfolio with your research and fundamentals of the business.