Wealthfront (NASDAQ:WLTH) Stock Price Breaks Below 50-Day Moving Average - Should You Sell?

Key Points

• Wealthfront shares fell below their 50-day moving average, trading as low as $10.17 and last at $10.20, compared with the average of $10.45; the article also reports the stock is down 6.4%.
• Analyst views are mixed: five rate the stock Buy, four Hold and one Sell, producing an overall Hold rating and a consensus price target of $12.36.
• Wealthfront beat quarterly EPS estimates, reporting $0.10 versus $0.09 expected, while revenue rose 0.9% year over year to $91.87 million; the company still posted a negative net margin.

Shares of Wealthfront (NASDAQ:WLTH - Get Free Report) crossed below its 50-day moving average during trading on Thursday. The stock has a 50-day moving average of $10.45 and traded as low as $10.17. Wealthfront shares last traded at $10.20, with a volume of 1,334,939 shares traded.

Wall Street Analysts Forecast Growth

Several research analysts have weighed in on the company. Wall Street Zen upgraded Wealthfront from a "sell" rating to a "hold" rating in a report on Saturday, July 18th. The Goldman Sachs Group reiterated a "neutral" rating and issued a $11.00 target price on shares of Wealthfront in a research note on Wednesday, October 7th. Wells Fargo & Company increased their target price on Wealthfront from $11.50 to $12.00 and gave the stock an "overweight" rating in a research report on Tuesday, November 3rd. Needham & Company LLC reissued a "buy" rating and issued a $13.00 price target on shares of Wealthfront in a research note on Wednesday, October 7th. Finally, Royal Bank Of Canada lowered their price target on Wealthfront from $13.00 to $11.00 and set an "outperform" rating for the company in a report on Thursday, September 10th. Five equities research analysts have rated the stock with a Buy rating, four have given a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat, the company has an average rating of "Hold" and a consensus price target of $12.36.

Wealthfront Stock Down 6.4%

The company has a 50 day simple moving average of $10.45 and a 200 day simple moving average of $9.73. The company has a market capitalization of $1.59 billion and a price-to-earnings ratio of -10.97.

Wealthfront (NASDAQ:WLTH - Get Free Report) last posted its earnings results on Wednesday, September 9th. The company reported $0.10 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.09 by $0.01. Wealthfront had a negative net margin of 19.42% and a negative return on equity of 14.62%. The firm had revenue of $91.87 million during the quarter. Wealthfront's revenue was up .9% on a year-over-year basis. On average, research analysts forecast that Wealthfront will post 0.37 EPS for the current fiscal year.

Insider Buying and Selling at Wealthfront

In related news, VP Kal Iyer sold 26,738 shares of the company's stock in a transaction on Thursday, September 17th. The shares were sold at an average price of $10.11, for a total transaction of $270,321.18. Following the completion of the sale, the vice president directly owned 232,494 shares of the company's stock, valued at approximately $2,350,514.34. This represents a 10.31% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Lauren Lin sold 4,574 shares of the company's stock in a transaction on Thursday, September 17th. The stock was sold at an average price of $10.10, for a total transaction of $46,197.40. Following the sale, the insider directly owned 171,816 shares of the company's stock, valued at approximately $1,735,341.60. This trade represents a 2.59% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 270,688 shares of company stock worth $2,796,816 over the last three months. 27.36% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the stock. BlackRock Inc. purchased a new stake in shares of Wealthfront during the 2nd quarter valued at about $74,766,000. Ieq Capital LLC acquired a new position in Wealthfront during the 2nd quarter worth approximately $24,706,000. North Reef Capital Management LP boosted its holdings in Wealthfront by 135.2% in the 1st quarter. North Reef Capital Management LP now owns 2,885,257 shares of the company's stock worth $26,689,000 after acquiring an additional 1,658,624 shares during the period. Southpoint Capital Advisors LP purchased a new stake in shares of Wealthfront during the first quarter valued at approximately $12,950,000. Finally, Pillsbury Lake Capital LLC purchased a new stake in shares of Wealthfront during the second quarter valued at approximately $9,163,768.

Wealthfront Company Profile

Wealthfront is a U.S.-based digital financial services company that provides automated investing, cash management and financial planning tools. Its platform is designed to help individuals manage savings and investments through online accounts and software. Wealthfront's offerings include diversified investment portfolios managed with automated strategies, cash accounts offered through partner banks, and tools for setting financial goals and tracking progress. The company has also offered services such as individual stock investing and portfolio lines of credit.

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