Stitch Fix (NASDAQ:SFIX) has been one of the market's big gainers since it began its recovery from the coronavirus-induced bear market. After bottoming in early April, the stock has come roaring back, climbing more 100% through Tuesday's closing price. This could be just the beginning.

Canaccord Genuity analyst Maria Ripps joined the ranks of Stitch Fix bulls on Wednesday, initiating coverage on the stock with a buy rating and setting a price target of $30. While the company operates in a "competitively intense" market, there's "significant opportunity" for growth. Ripps believes that apparel, and particularly fashion, have historically been a difficult market for e-commerce, due to the role that texture and fit play in personal clothing decisions. 

A woman smiling carrying a Stitch Fix box.

Image source: Stitch Fix.

"Stitch Fix solves for many of these issues through personal curation," Ripps wrote in a note to clients. The company uses individual stylists that get to know customers, build relationships, and work to understand personal tastes. This helps them provide "a consistent, emotionally appealing offering wrapped within a subscription-like experience that helps the consumer discover new brands." 

The pandemic has caused an acceleration in the adoption of e-commerce, which plays right to Stitch Fix's strength. Ripps estimates that the market for apparel e-commerce is vast, but has only reached about 25% penetration in the U.S. and U.K., Stitch Fix's two largest markets. She believes that level could reach 40% over the coming five years, and the company has the opportunity to win additional market share.

I think Ripps is onto something. Stitch Fix recently added a new, direct-buy feature that uses algorithms to help present customers with additional choices -- outside their regularly scheduled "Fixes" -- allowing them to purchase the items directly between timed shipments. The additional flexibility of this latest innovation has me more enthusiastic than ever about Stitch Fix's ability to disrupt the stodgy retail apparel market.