Fiverr International Ltd. (FVRR): A Bull Case Theory

We came across a bullish thesis on Fiverr International Ltd. (FVRR) on Value Investing Subreddit Page by Lastaplays. In this article, we will summarize the bulls’ thesis on FVRR. Fiverr International Ltd. (FVRR)’s share was trading at $31.52 as of Jan 23rd. FVRR’s trailing and forward P/E were 121.23 and 12.18 respectively according to Yahoo Finance.

Fiverr, with a market cap of $1 billion and a strong balance sheet, is making strategic moves toward increased profitability and sustainable growth. In 2023, the introduction of Promoted Gigs and the Seller Plus program significantly boosted Fiverr’s take rate to 31.8%, driven by 80% year-over-year revenue growth in Promoted Gigs and a 2.5x revenue surge from Seller Plus. The company’s expansion into complex service categories, particularly in AI and highly skilled areas, contributed to a 4% positive impact on Gross Merchandise Value (GMV), with complex services making up 32% of total GMV and achieving an impressive 29% year-over-year growth—up from 12% in 2022.

Customer retention remains a cornerstone of Fiverr’s strategy, with repeat buyers accounting for 67% of revenue as of March 2024, underscoring strong loyalty and satisfaction among its user base. In January 2024, the platform underwent significant AI-driven enhancements, including Fiverr Neo™, personalized user experiences, AI-assisted briefing tools, and an innovative AI-driven seller leveling system, further elevating the platform’s functionality and appeal.

These initiatives reflect Fiverr’s commitment to diversifying its offerings, improving customer experiences, and accelerating revenue growth, positioning the company for long-term success in the evolving digital services marketplace.

Fiverr International Ltd. (FVRR) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held FVRR at the end of the third quarter which was 19 in the previous quarter. While we acknowledge the risk and potential of FVRR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than FVRR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.