Zalando: shares jump as UBS upgrades to 'buy'

(CercleFinance.com) - Zalando shares are trading higher on Thursday morning after UBS analysts upgraded their rating on Europe's biggest online fashion retailer to "buy" from "neutral", raising their target price to 99 euros from 65 euros.


UBS said that recent data suggests higher growth and more rapid platform transition at the Berlin-based company, which could both prove to be catalysts for the stock.

"Our upgrade reflects new analysis that suggests (...) GMV growth and partner program growth, the two metrics investors care most about, will beat expectationsin fiscal year 2021," they wrote.

Gross merchandise volume, or GMV, is defined as the value of all merchandise sold to customers after cancellations and returns, while the partner program features more than 290 partners with over 900 brands and is the backbone of the group's platform strategy.

In its report, UBS notes new data suggests that Zalando will announce FY 2021 GMV growth guidance ahead of the consensus (24%) and mid-term guidance (20-25%) at its fiscal year 2020 results.

The Zalando share was up almost 4% in Frankfurt after these comments.

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