Kogan (ASX:KGN) share price jumps 6% in a week

The Kogan share price is on form this week…

| More on:
happy investor, celebrating investor, good news, share price rise, up, increase

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Kogan.com Ltd (ASX: KGN) share price is edging higher on Tuesday. At the time of writing, the ecommerce company's shares are up 0.5% to $11.91.

This means the Kogan share price is up over 6% since this time last week. This compares to a 0.9% decline by the S&P/ASX 200 Index (ASX: XJO) over the same period.

Why is the Kogan share price outperforming?

The catalyst for the rise in the Kogan share price appears to have been recent lockdowns across Australia.

Given that Kogan has been struggling with excess inventory after management failed to anticipate a sharp slowdown in online sales once physical stores reopened, investors appear optimistic that the current lockdowns will boost sales and help reduce its inventory levels.

Fellow ecommerce shares Redbubble Ltd (ASX: RBL) and Temple & Webster Group Ltd (ASX: TPW) have also recorded strong gains over the period. The Redbubble share price is up 12% in a week and the Temple & Webster share price is up 7%.

Is it too late to invest?

Although Kogan shares are outperforming, they are still down by a massive 39% since the start of the year.

This means it may not be too late to invest if analysts at Credit Suisse are to be believed. The broker currently has an outperform rating and $17.93 price target on the company's shares.

Based on the current Kogan share price, this implies potential upside of 50% over the next 12 months.

Credit Suisse believes the issues Kogan is facing will only be temporary and that investors ought to focus on its positive medium term growth prospects. Particularly given how its active customer base continues to grows.

In addition, Cannacord Genuity is positive on Kogan and has a buy rating and $14.00 price target on its shares. While it has been very disappointed with its performance in the second half, it remains positive on the future.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia has recommended Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

Green stock market graph.
Share Gainers

Here are the top 10 ASX 200 shares today

It was one for the history books today.

Read more »

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Why Boss Energy, DroneShield, Pilbara Minerals, and Polynovo shares are charging higher today

These shares are having a good time on hump day. But why?

Read more »

Ten smiling business people wave to the camera after receiving some winning company news.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a nervous, but positive, Tuesday for ASX investors.

Read more »

two colleagues high five each other as they sit side by side at a long desk in front of their laptop computers in an office environment.
Share Gainers

Why Bapcor, Ramelius, Sandfire, and WIA Gold shares are rising today

These shares are having a better day than most on Tuesday. But why?

Read more »

Ten happy friends leaping in the air outdoors.
Share Gainers

Here are the top 10 ASX 200 shares today

Investors started the week off in a good mood today.

Read more »

Excited couple celebrating success while looking at smartphone.
Share Gainers

Why Bellevue Gold, Bubs, Clarity Pharmaceuticals, and Regal Partners shares are rising today

These shares are starting the week on a positive note.

Read more »

Two people lazing in deck chairs on a beautiful sandy beach throw their hands up in the air.
Travel Shares

Guess which ASX All Ords travel stock just rocketed 17% on an earnings upgrade

Investors are piling into the ASX All Ords travel stock today. Here's what's happening.

Read more »

Man with rocket wings which have flames coming out of them.
Share Gainers

Guess which ASX All Ords stock just rocketed 34% on strong earnings growth

Investors just sent this ASX All Ords stock surging 34%. Here’s what’s happening.

Read more »