Demandware shares a 'buy' or too risky?

FBN's Charles Payne, retail analyst Hitha Prabhakar, Penn Financial Group founder Matt McCall and FBN's Tracy Byrnes on the outlook for Demandware.

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Can Demandware Make You Money?

By Payne's Picks FOXBusiness

Let’s talk about Demandware (DWRE).

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The stock has been volatile, but the business has been brisk. (But, yes, the stock has been all over the place.)

The company provides an enhanced e-commerce cloud platform, for the most part it’s all about retailers -- omni channel strategies for retailers. They help establish sites that provide design and architecture through consulting. Retailers love the scalability and security of the platform.

In the most recent quarter, retailer count climbed to 226 -- up 40%, with the company managing 924 sites, an increase of 39%. Total revenue is up 55% and gross margin expanded to 72.3% from 71.8%.

Here are some of the clients: Adidas, Barneys, Brooks Brothers, Deckers, Michaels and Lands End. Execution is beginning to improve, and the stock is in a reverse head-and-shoulders formation, which is a positive bullish sign.

I think from here the stock has potential to $65- $70. I like it short and long term, even though volatility is below normal, it is higher than average risk. It’s an Internet application play.

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DISCLOSURES

Demandware (DWRE)

Owns

Family Owns

Firm Owns

Investment
Banking

CHARLES N N Y N
MATT N N N N
TRACY N N N N
HITHA N N N N
TAMARA N N N N
ROB N N N N

 

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