Torrid Holdings’ Strategic Sales Turnaround and Growth Prospects Support Buy Rating

Analyst Lorraine Hutchinson from Bank of America Securities reiterated a Buy rating on Torrid Holdings (CURV – Research Report) and increased the price target to $7.80 from $7.00.

Lorraine Hutchinson’s rating is based on the promising sales turnaround strategy that Torrid Holdings has embarked upon. The company reported a better-than-expected fourth-quarter EPS, which was driven by improved sales despite some pressure on gross margins. This positive performance has been bolstered by a favorable customer response to new product offerings and an increase in regular price comparisons. Management’s guidance for fiscal year 2025 indicates a strong outlook with projected net sales and adjusted EBITDA, reinforcing confidence in the company’s earnings potential.
Furthermore, Torrid Holdings’ strategic initiatives, such as the launch of new sub-brands, have successfully attracted a younger customer demographic, enhancing engagement and traffic. These efforts, combined with ongoing innovations in the core product assortment, are expected to drive full-price sales. Although there are anticipated promotional pressures in the first quarter, cost-saving measures from planned store closures are expected to mitigate these challenges. Overall, the combination of these factors supports the Buy rating, with a revised price objective reflecting the company’s growth prospects.

Hutchinson covers the Consumer Cyclical sector, focusing on stocks such as Burlington Stores, Bath & Body Works, and Nike. According to TipRanks, Hutchinson has an average return of 5.3% and a 53.03% success rate on recommended stocks.