3 reasons the Redbubble (ASX:RBL) share price is in the buy zone

The Redbubble Ltd (ASX: RBL) share price could be going higher from here according to one leading broker…
The post 3 reasons the Redbubble (ASX:RBL) share price is in the buy zone appeared first on Motley Fool Australia. –

3 asx shares to buy depicted by man holding up hand with 3 fingers up

The Redbubble Ltd (ASX: RBL) share price was a strong performer on Tuesday.

The ecommerce company’s shares ended the day 4% higher at $5.19.

This latest gain means the Redbubble share price is now up an impressive 31% over the last couple of weeks.

Can the Redbubble share price still go higher from here?

One leading broker that believes the Redbubble share price can still go even higher from here is Goldman Sachs.

At the end of last week, the broker reiterated its buy rating and $6.25 price target on the company’s shares.

Based on today’s share price, this price target implies potential upside of 20% over the next 12 months.

What did Goldman Sachs say about Redbubble?

Goldman reiterated its buy rating in response to Redbubble announcing the appointment of its new chief executive officer. You can read more detail on this appointment here.

The company has named former SEEK Limited (ASX: SEK) executive, Michael Ilczynki, as its new CEO, effective 27 January.

The broker notes that Mr Ilczynki was with the job listings giant for 13 years, where he has worked in strategy, product & technology, and commercial operations, culminating as CEO of its Asia Pacific & Americas businesses.

The broker appears pleased with this appointment and continues to believe that Redbubble is well-positioned for growth. It named three reasons why it thinks the company’s shares are in the buy zone:

“(1) expansion of its TAM through continued broadening of its product categories.”

“(2) potential growth from increasing repeat usage on its platform (still relatively low at <1.5X p.a.).”

“(3) further operating leverage as we expect RBL to manage cost growth well below revenue growth over our forecast period (we forecast opex to grow at a 7% CAGR FY20E-FY23E vs. a marketplace revenue CAGR of 18% driving EBIT margins from 1.2% in FY20E to 11.3% in FY23E and an EBIT CAGR of 151%),” Goldman concluded.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post 3 reasons the Redbubble (ASX:RBL) share price is in the buy zone appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!