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That Kogan.com Ltd. (ASX: KGN) the course goes again in the right direction on Friday morning.
At the time of writing, the e-commerce company’s shares have risen over 1% to $ 9.87.
Despite tomorrow’s gains, however, Kogan shares have still fallen by more than 6% since the end of last week.
This may be due to concerns about the impact that proposed strikes by transport operators could have on online shopping during the peak Christmas season.
Is the value of the Kogan share good value?
A leading broker that seems to see a lot of value in the Kogan stock price is Credit Suisse.
According to a recent note, the broker currently has an outperform rating and a price target of $ 14.06 on the company’s shares.
Based on the latest Kogan share price, this implies a potential increase of 42% over the next 12 months.
What did the broker say?
Credit Suisse acknowledges that it is still unclear how quickly the company can reduce its cost base to normal levels after a disastrous fiscal year in 2021.
Due to the company’s excess inventory, Kogan reported a significant increase in inventory costs. It also led to Kogan spending more on sales and marketing to help move it. This weighed heavily on margins, limiting the full-year profit to just $ 3.5 million from gross sales of nearly $ 1.2 billion. It was a decrease of 86.8% from year to year.
Nevertheless, Credit Suisse believes that investors should look beyond the short-term and focus more on its long-term growth potential. This is supported by Kogan’s strong market position, the shift to online shopping and its growing private label business.
Overall, based on this, the broker feels that the Kogan stock is trading at an attractive level for investors and it maintains its outperform rating.