2 Things the Bears Might Have Missed About Wish

For investors of discount e-commerce marketplace Wish, the past six months have been one heck of a bumpy ride. Following its mid-December IPO at $24 a share -- trading under the name of its parent company, ContextLogic (NASDAQ: WISH) -- the stock climbed to $33 a share in January. But since then, the price has plunged by 77%, hitting a low of $7.52 on June 7. It has pared those losses a bit in the past week, but it would still need to more than double in price just to get back to its debut price.

So why did Wish fall? Bears are highlighting the company's decelerating revenue and user growth, coupled with its widening net losses. They're also comparing Wish to other e-commerce players that are growing more quickly -- and in many cases, profitably. Wish also offered weak guidance for the current quarter, which hasn't helped matters.

These are all legitimate concerns. But bears seem to be overly focused on short-term headwinds while failing to note two key factors that will shape the future of this e-commerce platform.

Source Fool.com