Another quick look at the Kogan.com Ltd [ASX:KGN] share price.
The online retailer is one of the standout performers of 2020. With the catalyst being COVID-19.
Kogan proved itself to be one of the go-to places to shop while people are stuck working from home.
Announcing that they have just recorded one of the best months in the company’s history, the share price pushed up 6.40% to $20.46 at time of writing.
What’s happening at Kogan?
Pre-COVID-19, Kogan was already a popular online company, selling a range of their own branded goods along with all the big-name furniture and electronic goods.
This all changed when the virus hit Australia with all states and territories going into lockdown.
The knock-on effect for Kogan was exploding sales and a rapidly rising KGN share price.
As people kept spending online, the stock price shot up from the low in March 2020 to over 490%.
The company also recorded its active customers growing to 2,461,000 as at 31 August 2020, an increase of 152,000 in the month of August 2020, and the largest monthly increase in the history of the business.
Where to from here for the Kogan share price?
With the pandemic grinding on into September, there are some changes coming that may affect Kogan. The federal government announced changes to JobKeeper and JobSeeker payments that will take effect at the end of this month.
This coupled with the end of the mortgage freeze may see a dramatic decrease in retail spending as people tighten their belts.
The Kogan share price declined in recent weeks to find support at the $18.68 level, if it continues down through this then the level of $15.91 may come into focus.
On the upside, if the KGN share price moves up, it may find resistance at the $23 level, which was the all-time high set in August.
There have been a number of stocks do very well through the pandemic. JB Hi-Fi Ltd [ASX:JBH], Afterpay Ltd [ASX:APT], and Temple & Webster Group Ltd [ASX:TPW] to name a few — what all these companies have in common is they are either solely internet-based or do considerable business online.
In recent weeks nearly all these companies have started to come down in price — could this be a sign of weakening spending and a start of a downtrend for the overall market?
Time will tell.
For Money Morning