Kogan shares rally after earnings beat analyst estimates
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The news: Shares in Kogan surged in afternoon trade after the e-commerce retailer reported a year-on-year increase in sales and earnings for the 10 months ended 30 April.
Shares climbed 15.12% to $3.96 at 12:38pm AEST.
RBC Capital Markets analyst Wei-Weng Chen maintains an “outperform” rating on the stock with a price target of $6.50, noting that Kogan’s core business and group EBITDA significantly outperformed expectations.
The numbers: For the 10 months ended 30 April, group sales rose 13.2% year-on-year to $875.6 million, supported by an 18.2% growth in Kogan.com.
Group revenue increased 6% year-on-year to $433.7 million, while group gross profit rose 11.1% to $177.9 million. Group adjusted EBITDA climbed 17.4% to $37.5 million.
The context: Kogan said that the group delivered positive EBITDA supported by the turnaround of its Mighty Ape division, which saw a materially improved performance during the period alongside strong profitability from Kogan.com.
The sources: ASX, RBC Markets analyst note
