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Wayfair rallies again after J.P. Morgan flips from a bear to a bull [1]
['Clark Schultz', 'Sa News Editor']
Date: 2023-01-23 07:12:34-05:00
Wayfair (NYSE:W) is on watch after J.P. Morgan issued a two-notch upgrade on the stock to an Overweight rating from Underweight.
Analyst Christopher Horvers and team said Wayfair (W) remains structurally relevant in the home retailing industry with a leading online assortment and advantaged supply chain, while the market has shifted its view dramatically to the downside.
The view on Wayfair (W) is that both a positive shift in market share trends and management’s newfound commitment to controlling expenses/investments should cause a significant inflection in earnings revisions from steeply negative over the past two years to positive.
"Additionally, over the next 3-5 years, W should outgrow the category given the longer-term shift towards online retailing and its advantaged assortment/supply chain as the largest scaled online specialty player in the industry."
J.P. Morgan assigned a price target of $82 to Wayfair (W) based on 0.7X EV/sales multiple, which is noted to be below the pre-COVID average of 1.5x. The firm also noted that the PT is below $82, where W traded just prior to COVID.
Wayfair (W) popped 8.35% in premarket trading on Monday to follow on Friday's 20% rally after the e-commerce retailer announced a cost restructuring plan.
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[1] Url:
https://seekingalpha.com/news/3926625-wayfair-rallies-again-after-jpmorgan-flips-from-a-bear-to-a-bull
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