ContextLogic Stock News and Forecast: WISH earnings preview, what can we expect?

ContextLogic (WISH) is due to report earnings after the close tonight, and the stock has already popped in anticipation. WISH shares closed up over 5% at $5.37 and already are ahead another 2% in Wednesday's premarket as investors gear up for a former retail favourite.

WISH may have lost some followers, but can earnings change this? Certainly momentum can. WISH shares were one of the original WallStreetBets names and surged as high as $32.85 back in January of this year. Quite a sharp fall from those highs, but to add some context WISH shares had nearly doubled in January 2020. 

WISH stock news

Okay, let us dive right in. Earnings will be out after the bell this evening. Earnings per share (EPS) is expected to show a loss of -$0.15, while revenue is estimated to come in at $373.9 million. WISH shares have recently seen headwinds from price target reductions from Cowen & Co., who cut their price target from $10 to $6 last week. Credit Suisse is out with a cut to their price target for WISH stock this morning. The Swiss investment bank cut WISH to a $15 price target and maintained its outperform rating. The last set of earnings from WISH on August 12 saw misses on top and bottom lines. EPS was -$0.18 versus the -$0.14 estimate. Revenue was $656 million versus the $722.9 million estimate. WISH shares fell nearly 20% after that earnings call in August. 

WISH stock forecast

It is quite hard to forecast something that has fallen so far. WISH stock has in the past month put in place a small series of higher lows, but that may just be to do with interest and volume drying up as investors give up on the name. Clearly, given the stock price and potential interest from retail, we would think the risk-reward is to the upside. We have seen how high this one can go if retail traders create enough momentum, whereas the downside is obviously capped. Not exactly a great investment argument!

Resistance at $6.31 from October 20 would be the first sign of a momentum shift and could draw in more short term players. That would then see a test to $7.06, which is an area of high volume so more resistance. Support is not strong in our view but is at $4.61 from the October low. This one is high risk, so use stops or trade accordingly.

WISH 1-day chart