Farfetch shares pop after JD.com launch
Farfetch Ltd. (FTCH) shares popped 3.3% in Wednesday premarket trading after closing up nearly 7% on Tuesday following news that the luxury e-commerce retailer launched a flagship on China's JD.com. The move expands on a partnership that began in July 2017 and comes after the February announcement from Farfetch China that it was acquiring Toplife, JD's luxury portal. JD.com is also a strategic investor in Farfetch. "Notably, the launch was originally slated for the tail end of 2019, but they have now launched the business about six months ahead of schedule, which we view very positively (they'll be able to reap the potential rewards of this partnership earlier than expected)," wrote Wells Fargo analysts led by Ike Boruchow. Wells Fargo also highlights the three million JD.com users who "are considered 'pre-qualified' luxury customers" that Farfetch will now have "Level 1" access to, meaning users will see the Toplife button when they open the JD.com app. "Ultimately, we believe that China is Farfetch's most compelling long-term opportunity (we see a $6 billion GMV opportunity by FY25 vs. $200 million today), and the launch on JD is a significant milestone for the company's growth ambitions in this country," said Wells Fargo, which rates Farfetch stock outperform with a $32 price target. Farfetch shares have rallied 18.6% for the year to date outpacing the S&P 500 index , which has gained 15.1% for the period.
-Tonya Garcia; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
June 12, 2019 08:36 ET (12:36 GMT)
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