Redbubble shares plummet on outlook
Stock prices at Melbourne-based online personalised print portal Redbubble are in freefall, collapsing by almost half on revised growth forecasts.
Shares tumbled by 43 per cent in trading yesterday and didn't recover. Investors took the axe to the business as it announced growth would slow to 20 per cent this year, and in some sectors would barely move. The company said its sticker business was struggling to grow and that its apparel sales have not recovered from a change in a Google algorithm a year ago.
Share price is down to $1.03, a five month low, although that is still 15 per cent ahead of a year ago. Major analysts have a target price of around the $2 marker for the business.
Since Redbubble was formed by three mates in Melbourne 13 years ago, it has enjoyed supersonic growth and now operates around the world. Sales in the last financial year reached $257m, and it made it into the black for the first time since its IPO, with an EBITDA of $3.8m.
Redbubble matches artists with the public in its cloud-based portal, enabling the public to choose an artwork then have it printed in a variety of products such as caps, t-shirts, mugs, pillowcases, and the like. It does no printing itself, but partners with printers in the countries it operates in. It has some 700,000 artworks on its site, and last financial year had 5.7 million active customers.