Over the last few years, the world of fast fashion has seen massive growth, yet the industry's manufacturing methods continue to remain in the past. Environmental concerns remain prominent for large industry players, and smaller ones wouldn't mind cutting costs, either. In comes Kornit Digital (KRNT), an Israeli digital printing systems firm currently disrupting supply chains.
While shares were down considerably year-to-date at last glance, some analysts see a newly discounted growth opportunity.
One of those bullish voices in the crowd is James Ricchiuti of Needham & Co., who wrote that Kornit's "business remains healthy" and he foresees "strong tailwinds" for the next year and a half. KRNT's business model is supported by its direct-to-garment and direct-to-fabric waterless printing systems, and is positioned to continue capturing market share in its industry.
Ricchiuti reiterated a buy rating on the stock, and lowered his price target to $155 from $202. The downgrade in price target comes off the back of an overall decline for growth and tech names across the stock market. (See Kornit Digital Risk Factors on TipRanks)
Kornit has been acquiring both large and smaller customers, and is experiencing strong momentum from clients wishing to emphasize sustainability. The five-star analyst wrote: "Leading apparel retailers in recent weeks have highlighted the need to de-risk supply chains through near-shoring and on-shoring strategies, while at the same time, large e-commerce apparel companies have emphasized the importance of adopting advanced digital production work flows to deliver short-run and custom orders more rapidly."
Out of almost 8,000 expert analysts, Ricchiuti maintains position #144. He has been right on his stock picks 62% of the time and has an average return of 27.8% on each of them.
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