Could this online ASX share be benefitting from Delta?

This ASX share is in focus as mask wearing becomes a part of life for some Aussies again…

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Two children in car wearing covid masks and playing on laptop

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ASX shares with exposure to online shopping and e-commerce were hot property back in the tail end of 2020. However, as the promise of a national vaccination rollout arose and restrictions eased, such investments fell out of favour.

One such company is Redbubble Ltd (ASX: RBL), its share price falling 56% from its peak of $7.35 in January to $3.19 on Friday.

Redbubble’s online marketplace sells face masks bearing creative designs from artists. So, leading up to the company’s full-year results, the question is, has the company experienced a revenue boost from the recent Delta wave?

Looking at the past

Around the same time last year, Redbubble delivered its FY20 results. On that day the Redbubble share price hit a record as investors digested the significant growth in the company’s revenue.

According to the release, Redbubble’s marketplace revenue was $49 million in July 2020. This represented an incredible 132% increase on the prior corresponding period. It was revealed by management that roughly $26 million of the company’s July revenue was derived from face mask sales.

Since then, the company has continued to grow revenue. However, it has been less telling with its exact face mask revenue. Potentially this was a strategic decision, so the business didn’t become just another ‘COVID stock’.

Taking a quick look at google trends, it is evident people are searching ‘face masks’ a lot more than they were between March and June. Likewise, Redbubble’s website traffic picked up by 8.4% to 30.14 million views in July compared to 27.8 million in June (Similarweb).

Although, conclusions shouldn’t be drawn purely on a correlation. Investors will need to sit tight until Thursday next week to find out whether the company has benefitted.

Redbubble share price snapshot

The Redbubble share price hasn’t been kind to shareholders in 2021. On a year-to-date basis, the marketplace provider’s shares are down 46%. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is up 14%.

Finally, the company is trading on a trailing price-to-earnings (P/E) ratio of 27.7 times. This has reduced during the year as the Redbubble share price fell.

Should you invest $1,000 in Redbubble right now?

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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