What Does Rising Website Traffic Mean for These 2 Stocks?

Uncertainties in the economic environment caused by high inflation, geopolitical tensions and supply-chain challenges make it even more difficult for investors to predict a company’s performance.

We, at TipRanks, provide our investors with tools that can separate the wheat from the chaff and help investors make informed investment decisions. One such tool is TipRanks’ Website Traffic Tool. 

The tool uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, to highlight stocks that have been witnessing heightened website traffic in recent times.

While the rise in website visits could pave the way for a strong quarter, a drop in the number of visits online might point at a weak future.

Now, let’s discuss two stocks with rising website traffic, which are yet to report earnings this season.

Snowflake Inc. (NYSE: SNOW)

With a market capitalization of $43.7 billion, Snowflake is a cloud-based company, which provides a data platform in the United States and internationally. Its platform enables customers to consolidate data into a single source to drive meaningful business insights, build data-driven applications, and share data.

The company went public in September 2020 and is known for its significantly high growth rates. Further, Snowflake has been able to consistently increase its customer base.

In its last earnings release, Snowflake said it expected to report product revenue growth of 79%-81% in the first quarter of Fiscal Year 2023. Further, for full-year Fiscal 2023, it anticipates revenue growth of 65%-67%.

Ahead of its earnings release, which is scheduled on May 25, 2022, Kirk Materne of Evercore ISI maintained a Buy rating on Snowflake with a price target of $250 (80.1% upside potential from current levels).

Materne said, “Our discussions with SNOW partners continue to remain very upbeat in terms of the company’s position in the market and overall demand trends. Our only concern heading into the print is whether consumption from some of SNOW’s technology/’emerging’ customers could create more seasonality in the business as IT spending comes under more scrutiny for some.”

Overall, the Street has a Moderate Buy consensus rating on the stock based on 17 Buys, seven Holds and one Sell. Snowflake’s average price target of $268.33 implies 93.3% upside potential from current levels. 

As per the website traffic trends indicated by TipRanks, the company seems to be well-positioned for the to-be-reported quarter.

According to the tool, snowflake.com has recorded a 28.2% year-to-date rise in global unique visits, compared to the previous year. Likewise, the website traffic has grown 25.3% quarter-to-date (February-April), compared to the same period last year. This indicates that the company could report strong revenues in the quarter ahead. 

Ulta Beauty (NASDAQ: ULTA)

Headquartered in Bolingbrook, IL, Ulta Beauty is a retailer of cosmetics, fragrances, skin and hair care products, and salon services.

In its previous earnings report, CEO Dave Kimbell said, “Our outlook for fiscal 2022 reflects our expectations for Beauty growth as well as the challenge of lapping exceptional performance in fiscal 2021, ongoing wage and supply chain cost pressures, and investments in new capabilities to support future growth.”

For the Fiscal Year 2022, ULTA forecasts net sales to be in the range of $9.05 billion to $9.15 billion, up 4.9% to 6% year-over-year. Comparable sales are expected to grow in the range of 3% to 4%. The company is expected to report its first-quarter results (ended April 30, 2022) on May 26, 2022.

Recently, J.P. Morgan analyst Christopher Horvers maintained a Buy rating on Ulta Beauty with a price target of $460. The price target implies 32.7% upside potential from current levels.

The rest of the Street is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on 11 Buys and five Holds. ULTA’s average price forecast of $450.72 implies 30% upside potential.

A look at the company’s website traffic trends reveals that the number of visits to ulta.com grew 22.2% year-over-year in February-April. Further, the website traffic has grown 16.7% year-to-date, compared with the same period last year. The increasing footfall on the company’s website means that Ulta Beauty is likely to witness growth in the to-be-reported quarter.

Closing Note

Amid the current uncertain economic environment, investors are more interested in making informed investment decisions. Rising footfall on the websites of companies is reflective of their popularity and growth prospects.

Learn more about the Website Traffic tool in this video by Youtube sensation Tom Nash.