Should I invest in Fiverr International shares after Q4 results?

Fiverr International Ltd. (NYSE: FVRR) shares have weakened more than 35% since the beginning of 2022 year, even though the company reported solid fourth-quarter results this Thursday.

Fiverr finished the fourth quarter with 4.2 million active buyers, and CEO Micha Kaufman said that the outlook for the upcoming quarters remains positive.

Fiverr finished Q4 with 4.2 million active buyers

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Fiverr International Ltd enables sellers to sell their services and buyers to buy them via its platform. The company’s platform includes approximately 500 categories in eight verticals, including design, translation, digital marketing, technology, video, music, business, and lifestyle.

Fiverr continues to improve its position in the market, and the fourth-quarter earnings results show that it is moving in the right direction. Total revenue has increased by 42.8% Y/Y in the fourth fiscal quarter to $79.8 million, while the Non-GAAP EPS was $0.22 (beats by $0.11).

It is important to say that Fiverr finished the fourth quarter with 4.2 million active buyers compared to 3.4 million at the end of the fourth quarter of 2020. This represents an increase of 23% year over year while spending per buyer as of December 31, 2021, reached $242, compared to $205 as of December 31, 2020.

Positive information is that adjusted EBITDA in the fourth quarter of 2021 grew to $8.9 million, compared to $4.6 million in the fourth quarter of 2020.

Total revenue for the 2021 fiscal year grew 57% compared with the previous year, and the company continues to demonstrate its ability to deliver not only a superior growth rate but also profitable growth. Micha Kaufman, Founder and Chief Executive Officer of Fiverr, added:

We generated an adjusted EBITDA of $23 million in 2021, implying an adjusted EBITDA margin of 7.7%, compared to 4.8% just a year ago and a negative 16.8% two years ago. We are committed to our disciplined approach in prioritizing growth while making progress towards our long-term profitability target.

The company’s management expects revenue to be between $85 million and $87 million for the next fiscal quarter, while adjusted EBITDA should be between $1.5 million and $3.5 million.

Fiverr International is still not profitable on a fiscal year basis, but this could change soon, and shares of this company represent solid long-term investment at the current price.

$80 represents first resistance

Fiverr International shares have weakened more than 35% since the beginning of the 2022 year, and the current price could be a good entry-level for traders.

If the price jumps above $80, the next target could be around $90, or even above. On the other side, if the price falls below $60 support, it would be a “sell” signal, and we have the open way to $50.

Summary

Fiverr International shares have weakened more than 35% since the beginning of the 2022 year, even though the company reported solid fourth-quarter results this Thursday. Fiverr finished the fourth quarter with 4.2 million active buyers and total revenue for the 2021 fiscal year grew 57% compared with the previous year.

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