UPDATE: Needham & Company Starts Revolve Group (RVLV) at Buy
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Needham & Company analyst Anna Andreeva initiates coverage on Revolve Group (NYSE: RVLV) with a Buy rating and a price target of $60.00.
The analyst comments "We initiate coverage of RVLV with a Buy and a $60 PT. With its unique influencer model, RVLV fits the bill, near term, as an ultimate reopening play (with Coachella ahead for the first time since '19, we think there's upside to Street's 35% sales growth expectations in 1H22). Longer term, we forecast consistent 20% and 15% growth in sales and EBITDA, respectively. Driving consumer overlap between REVOLVE and FWRD provides upside--we estimate an increase to 10% penetration between the two brands could yield an incremental $100M+ in sales (by '23); plus, given its premium price points, historically the brands withstand inflation better than most. At 2.8x our 2022 sales estimate, valuation is back to pre-pandemic levels--we think a premium is warranted given RVLV's attractive combination of strong top line and bottom line growth."
Shares of Revolve Group closed at $47.03 yesterday.
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