The Redbubble Ltd (ASX: RBL) share price was a very strong performer on Wednesday.
The ecommerce company's shares jumped 12% in afternoon trade to finish the day at a record high of $6.11.
This means the Redbubble share price is now up 460% since the start of the year.
Why did the Redbubble share price storm to a record high?
Investors appear to have been buying the company's shares for a couple of reasons.
The first is a series of positive updates from fellow ecommerce companies such as Kogan.com Ltd (ASX: KGN) and Mydeal.ComAu Pty Ltd (ASX: MYD) that demonstrate that the online shopping boom has continued.
This was particularly the case during the Black Friday and Cyber Monday promotional period, where a number of buy now pay later providers and retailers both reported stellar growth.
Another catalyst was a broker note out of Goldman Sachs last month.
Its analysts reiterated their buy rating and $6.25 price target on the company's shares in response to Redbubble announcing the appointment of its new chief executive officer, former SEEK Limited (ASX: SEK) executive, Michael Ilczynki.
Goldman seemed to be pleased with the appointment and continues to believe that Redbubble is well-positioned for growth.
Why is Redbubble positioned for growth?
The broker named three reasons why it thinks Redbubble is well-placed for growth and was good value at the time.
It commented:
"(1) expansion of its TAM through continued broadening of its product categories."
"(2) potential growth from increasing repeat usage on its platform (still relatively low at <1.5X p.a.)."
"(3) further operating leverage as we expect RBL to manage cost growth well below revenue growth over our forecast period (we forecast opex to grow at a 7% CAGR FY20E-FY23E vs. a marketplace revenue CAGR of 18% driving EBIT margins from 1.2% in FY20E to 11.3% in FY23E and an EBIT CAGR of 151%)," Goldman concluded.
Whether the Redbubble share price can go higher in the near term, only time will tell. But it is worth noting that its shares are now trading within a whisker of this price target.
