The Kogan.com Ltd (ASX: KGN) share price is out of form and trading lower on Monday.
In afternoon trade, the ecommerce company's shares are down 1% to $10.46.
This means the Kogan share price is down 46% since the start of the year.
Why is the Kogan share down 46% in 2021?
Investors have been selling down the Kogan share price this year after its strong performance during the early stages of the pandemic reversed.
This was driven by management failing to predict a sharp slowdown in sales after bricks and mortar stores reopened.
This ultimately led to the company having a significant inventory excess and, at times, nowhere to put it. The latter resulted in the company incurring millions of dollars in demurrage costs for stock that was stuck at ports.
In light of this, Kogan reported a net profit after tax of just $3.5 million for FY 2021, down 86.8% year on year, and decided to suspend its dividend.
Is this a buying opportunity?
One leading broker that believes the Kogan share price has fallen to an attractive level is Credit Suisse.
In response to its full year results last month, the broker retained its outperform rating but cut its price target down to $14.06.
Based on the current Kogan share price, this implies potential upside of 34% over the next 12 months.
According to the note, the broker acknowledges that its elevated cost case could take a bit of time to normalise. However, it believes it is worth sticking with the company.
Credit Suisse remains positive on the company due to its private label business and its long term growth potential thanks to its strong market position and the shift to online shopping.
All in all, while the Kogan share price performance has been very disappointing over the last 12 months, the broker appears optimistic the next 12 months will be much more positive.