What happened

Shares of Revolve Group (RVLV -0.51%) were climbing higher after the e-commerce apparel company got a price target hike from an analyst and as a number of its peers were moving higher today, seemingly in anticipation of the economic reopening as the vaccine rollout accelerates.

As of 12:33 p.m. EDT, the stock was up 9.6%. 

The management team at Revolve, dressed in white

Image source: Revolve Group.

So what

KeyBanc raised its price target on Revolve this morning from $47 to $58 and maintained an overweight rating on the stock. Analyst Edward Yruma forecast that the company would make $0.27 in earnings per share in the second quarter, above the analyst consensus of $0.19, which is likely a reflection of the leverage the company will get as demand for dresses and other "occasion-wear" accelerates ahead of the reopening.

Peers like Stitch Fix, which also got a bullish analyst note today, and online apparel sellers like RealReal and Poshmark were also moving higher today.

The sector is in a prime position to benefit from the recovery as e-commerce sales should remain strong this year, especially early in the transition, and as Americans are eager to refresh their wardrobes for when they can back to social events or the office.

Revolve Co-CEO Mike Karanikolas said as much in the company's most recent earnings report, noting, "We believe REVOLVE is well positioned to benefit from the reopening of economies, which will enable our customer to finally enjoy the active social lifestyle she loves and has come to associate with REVOLVE."

Now what

Despite the headwinds from the pandemic, which led to revenue falling 3% last year to $580.6 million, Revolve managed its business and inventory well last year, delivering a 25% increase in adjusted EBITDA to $69.3 million. That bodes well for the coming year as the growth stock doubled its cash and entered 2021 with a clean inventory position.

Revolve also uses an influencer-driven model that targets Gen Z and millennials who are likely to resume their pre-pandemic social activities once they are vaccinated. All of those factors make the company look like a prime recovery stock heading into the summer.