One of the best performers on the All Ordinaries index on Friday has been the Redbubble Ltd (ASX: RBL) share price.
In afternoon trade the ecommerce company's shares climbed over 9% to $1.44.
Why is the Redbubble share price zooming higher?
The catalyst for this strong gain has been a broker note out of Goldman Sachs this morning.
According to the note, the broker has upgraded its shares to a buy rating from neutral and lifted the price target on them to $1.65.
The broker made the move after its research showed that the launch of new products appeared to have gone down well with users of its site.
Goldman said: "Since the 4Q19 update on 30 July, RBL has launched 3 new RB products which are gaining traction with artists, with a further 2 new products launching soon. These 5 new products, in addition to the 7 live as at the 4Q, represent a 18% rise in the number of products RB offers (up from 65). The live products have been launched in time for the US back to school, Thanksgiving, and Christmas shopping periods."
"These launches give us increased confidence in RB returning to stronger growth once the algorithm changes are cycled in late Sep/early Oct. In addition, TP has launched its first new product (pins) since it was acquired in Nov 2018," the broker added.
This, combined with content partnerships, strong app downloads, and a focus on membership experience, led to the broker upgrading its earnings forecasts for the company through to FY 2022.
So much so, it now expects Redbubble's revenue to grow by a CAGR of 23% between FY 2019 and FY 2022.
The broker isn't quite as positive on the Treasury Wine Estates Ltd (ASX: TWE) share price, though. Another note out of the broker this morning reveals that it has reiterated its sell rating and $14.40 price target on the wine company's shares.
According to the note, the broker has been looking at industry data and believes that it has been increasingly negative for the Australian wine giant. It notes that price deflation has continued in the Chinese ecommerce channel.
