Stifel Maintains Buy on ChannelAdvisor
In a report published Friday, Stifel analyst Brad Reback maintained a Buy rating on ChannelAdvisor (NYSE: ECOM), raising its price target to $46.00 from $42.00.
According to the report, the new target price is derived by applying a roughly 8.5x multiple to our CY15 revenue estimate of $105.6M. ECOM's high growth SaaS peer group currently trades around 7-10x CY15 revenue.
“Similar to the re-acceleration we saw in ECOM's other channels, we had expected SSS data in eBay to snapback to roughly 15% in December,” the report noted. “However, ECOM's management believes eBay's decision to not heavily invest in TV promotions and shift some spend to Google Shopping caused sales to be relatively flat at 11%. We expect this channel to improve in 2014, primarily on easing comps.” Some risks to ECOM's target price included:
-Disruption in the company's infrastructure. -Concentrated shareholder base. -Overages could be limited in a slowing economic environment. -Potential pushback from customers as they scale and process more GMV.
ECOM closed Thursday at $43.81 with shares trading up at 3.61 percent.
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