It's double digit share price growth for MyDeal, but investors' confidence in e-com seems to be otherwise shaky.
While it’s been a disappointing few weeks on the ASX, there is one company that has made gains while the rest of the E-Com Index continues to drop. As at close of ASX on Monday, the MyDeal share price is up 16.8% to $0.66 over the last fortnight. As a point of comparison, Cettire shares dropped to 35.3% over the same period to $1.43.
In the 14 day period, the ASX Listed E-Com Index dropped 10.5% while the ASX200 gained 1.4%.
Despite this, general e-com performance is steady in the grand scheme of things. The grand scheme of things being that the relative carnage on the ASX for e-com companies seems to have stabilised somewhat. And we can only look at performance relative to what has preceded it. Kogan, for example, closed at $5.28 on Monday, just a 3.8% dip over 14 days. This is far from the $10+ it was comfortably recording mid-to-late last year. I mean, it’s not great, but it is something, albeit taking a clearly a glass half full approach. After its results announcement last month and a pause in trading, a fast(er) downward spiral was also a possibility. It has hit a new 52-week low today at $5.18, and whether it continues to drop, or levels out somewhat (which is what we have been seeing in recent weeks) is yet to be seen.
Similarly, Adore Beauty, Bike Exchange, Booktopia, RedBubble and Temple & Webster seem to be in a similar holding pattern, with small share price losses over the shorter term. Adore Beauty is down just 2.9% over seven days, to $2 at close of ASX on Monday. Booktopia, Temple & Webster and RedBubble are down 5.1%, 5.5% and 5.9% respectively, all recording similar losses in the last week. Bike Exchange is down 9.3% in the same period, now at $0.07. It has been hovering around this number and is yet to climb past $0.10+ since mid-February.
While not seeing gains across the board, there aren’t the volatile swings that we saw in the aftermath of H1 FY2022 results reporting.
Source: Power Retail Australian Listed E-Com Index based on ASX reporting for the period.
The ASX Listed E-Com Index has been impacted by both global and local events, with flooding in NSW and QLD as well as the economic fallout from the Ukraine crisis impacting both consumer and investor confidence. Inflationary pressures, supply chain issues, as well as the pandemic landscape, mean that e-commerce isn’t seeing the same supercharged growth of 2020 and 2021.
Some companies are faring worse than others, however, with Cettire the worst performer on the ASX Listed E-Com Index. Last year, Power Retail broke news of a trading halt after Cettire shares dropped to $1.755, and then climbed back up to $1.98 (-21.43%). The sharp decline followed the publication of an article in the AFR that reported fund managers who bought into Cettire’s $65 million initial public offering were worried about the company’s ‘longer-term prospects’. The company made a massive recovery, with shares above $3 at the beginning of the year. Now though, there’s been a 54.6% drop over 90 days, closing at $1.43 on Monday. It may be that luxury fashion is a category that investors are worried about in the current environment, or its dependence on the global supply chain may be ringing alarm bells.
MyDeal is the best performer on the Index, up 12.8% over seven days (albeit down 25% over the longer-term 90 day period). “I think that’s recognition from the market; we are potentially undervalued with our share prices and value against other players; where we have more active customers; where we do similar GT; where we have loyalty,” Ryan Gracie, CMO of MyDeal told Power Retail last month in relation to the boost in shareholder confidence.
Figures are current as at close of ASX on 14 March 2022. This is analysis only and not intended as investment advice.
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