Online retailer Kogan.com Ltd [ASX:KGN] is experiencing a meteoric rise in share price through the COVID-19 pandemic.
With the KGN share price up 7.34% to trade at $20.70 at the time of writing, Kogan edges closer and closer to holding a $2 billion market cap.
What’s happening at Kogan?
Kogan’s impressive rise is a by-product of a combination of unique situations.
It’s very easy to just sum it up as COVID-19, but there is more to it than that.
First — the company itself. Kogan.com came about in 2006, founded by founder Ruslan Kogan, who had an IT background.
The company always has been an online retailer.
And its online presence is propelling it to new heights in the pandemic era.
This shift to online shopping can be seen in Kogan’s latest announcement:
- ‘Active Customers grew to 2,309,000 as at 31 July 2020, an incremental 126,000 in the month of July 2020
- ‘Gross Sales grew more than 110% YoY
- ‘Gross Profit grew more than 160% YoY
- ‘Adjusted EBITDA was more than $10m’
Outlook for the KGN share price
As the old saying goes — make hay while the sun shines! The KGN share price is currently doing exactly that. Rising 485% since the low in March, Kogan is making the best out of a bad situation. But how long can this last?
In the short to medium term, the action on the KGN share price is looking strong. Trading at $20.20 at the time of writing, it pushed through the resistance level of $19.75, and did so on decent volume. Should this continue then the level of $21.90 may provide future resistance.
On the downside, if the price were to retrace, the levels of $17.60 and $15.35 may be enough to halt the fall.
For Money Morning
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