IZEA Worldwide (IZEA) has recently attracted the attention of significant investors based on its strong financial performance in its last reported quarter. But is it worth adding the stock to the portfolio because of the company’s mixed growth potential? Read, let’s discuss.
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IZEA Worldwide, Inc. (IZEA), Whose headquarters are located Winter Park, Fla., A marketing technology company that provides software and professional services that allow companies to collaborate and transact with today’s top social influencers and content creators. The company is a champion of the growing “Creator Economy”, allowing people to monetize their material, creativity and influence.
IZEA’s share price rose nearly 50% last month due to its impressive financial performance in its last reported quarter. The Managed Services team had the largest quarterly bookings in the company’s history, with a total contract of 12.1 million, surpassing $ 12 million for the first time since its inception.
However, its shares are down 61.6% compared to last year which closed at 5 1.55 in yesterday’s trading session. In addition, the stock is currently trading 72.3% below the 52-week low of $ 5.58.
Here’s how to shape IZEA’s performance in the near term:
Uncertainty related to metaverse
The term ‘metaverse’ has gained traction recently after the social networking giant Facebook was renamed and the meta platform incorporated.FB), And Microsoft Corporation (MSFT) This new creative hyper-real alternative based on augmented reality has submitted its claim to the universe. However, considering that Metaverse is still being built and the issue of privacy invasion has been raised, its near-term prospects look uncertain.
Poor profitability
IZEA’s 0.21% CAPEX / Sales Multiple 0.46% is 94.7% lower than the industry average. Also, its Net income margin, ROA, and ROC are negative at 10.5%, 3.5%, and 6.2%, respectively. And its cash from operations stood at $ 2.57 million, negative compared to the industry average of $ 299.40 million.
Possibility of mixed growth
Analysts expect IZEA’s revenue to grow 36.6% this year and 30.5% next year. However, its EPS is expected to decline by 80% and remain negative this year.
POWR ratings reflect uncertainty
IZEA has an overall C rating, which is equivalent to a neutral in our ownership POWR rating Method. POWR ratings are calculated based on 118 individual factors, each factor being weighed to an optimal degree.
Our proprietary rating system evaluates each stock based on eight distinct categories. IZEA has a D grade of ৷ for stability Compatible with the stock’s 2.72 beta stability grade.
F-rated out of 61 stocks Internet Industry, IZEA ranked # 15
Beyond what I said above, anyone can see the IZEA rating for quality, growth, speed, feel and quality. Here.
The last row
Although the company has strong profits and strong financial performance in its last reported quarter, the prospect of its mixed near-term growth may raise investor concerns. So, we think investors should wait for the company’s prospects to stabilize before investing in the stock.
How IZEA Worldwide Inc. (IZEA) Stack up against his peers?
Although IZEA has an overall C rating, none of its industry counterparts, Trivago NV (TRVG), Which has an overall A (strong buy) rating and Yelp Inc. (YELP) And Travelju (TZOO), Which has an overall B (Buy) rating.
Note that TRVG is one of the few stocks selected by our Chief Growth Strategist, Jaimini Desai, who currently has POWR stock in the $ 10 portfolio. Learn more here.
IZEA shares fell $ 1.55 (-100.00%) in pre-market trading on Wednesday. Year-to-date, the IZEA rose 11.94% over the same period as the benchmark S&P 500 Index rose -5.54%.
About the Author: Pragya Pandey
Pragya is an equity research analyst and financial journalist with a passion for investing. In college he did a major in finance and is currently pursuing a CFA program and is a second tier candidate.
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