Is the Kogan.com Ltd (ASX: KGN) share price a buy?
It's one of the leading online sellers in Australia, so whilst the coronavirus outbreak is horrible, the restrictions are boosting Kogan.com.
It sells a large array of different products through its website, some of which are in high demand right now.
In the third quarter of FY20, Kogan.com said that it ended with just over 1.8 million active customers, which was growth of 13%, after a sizeable increase in marketing.
Gross sales rose by over 30% and March gross sales went up by more than 50%. Gross profit increased by 23% and March gross profit also rose by more than 50%.
Overall operating costs grew by 37% as the company invested in marketing to grow its active customers which will hopefully have an ongoing long term benefit to the business. Marketing efficiency is expected to increase as it collects and acts on that data.
'Adjusted EBITDA' (earnings before interest, tax, depreciation and amortisation (EBITDA) grew by more than 4%.
At the end of the period Kogan.com had $47.8 million of cash with the debt facility drawn to $26 million.
Kogan Marketplace continues to add sellers at a very fast pace. The number of new sellers currently in the integration phase, which are yet to go live, is more than 50% of the number of current active sellers.
Is the Kogan.com share price a buy?
Since 21 February 2020 the Kogan.com share price has actually risen 30%, though it's lower than where it was in January 2020.
I wrote several weeks ago that Kogan.com was at a crazy cheap price and it's up 66% since then. I don't think it's a bargain buy today like it was then. I'd want to see that Kogan.com's higher expenses are helping long-term growth before buying shares right now.
I believe there are plenty of ASX growth shares that are trading at cheap prices that could be better value buys.
