On Tuesday the MyDeal.com.au Limited (ASX: MYD) share price was a particularly positive performer.
The newly listed online retail marketplace provider's shares finished the day over 7% higher at $1.29.
This means that the MyDeal share price is now up 29% from its initial public offering (IPO) listing price of $1.00.
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What is MyDeal?
MyDeal is an online retail marketplace provider with a focus on furniture, homewares, appliances, technology, baby products, and hardware.
It recently raised $40 million from its IPO, which will be used to drive future growth. This includes growing its private label business, investing in its proprietary technology, and investing in advertising to grow its customer base and brand.
The online retailer has been a positive performer in FY 2021. It recently released a first quarter update which revealed quarterly gross sales growth of 317% to $56.67 million.
This was driven by the accelerating shift to online shopping and a 268% increase in active customers to 669,897 compared to the prior corresponding period.
Can the MyDeal share price go higher?
One broker that still sees a lot of value in MyDeal shares is RBC Capital Markets.
Earlier this month it initiated coverage on the company with a buy rating and $1.60 price target. This price target implies potential upside of 24% over the next 12 months.
RBC commented: "We think MYD is at an inflection point as annualised gross transaction value (GTV) exceeds $200m, SKUs pass 5m and customers approach 700k. Key operating metrics indicate the business is starting to benefit from a flywheel effect."
"This increasing scale presents an opportunity for MYD to position itself as a leading online player focused on a category that is seeing accelerating online penetration. A successful private label strategy is key, as it improves unit economics, provides a point of differentiation and can help build a brand," the broker concluded.
It also notes that its shares trade at a sizeable discount to Kogan.com Ltd (ASX: KGN) and Temple & Webster Group Ltd (ASX: TPW).
