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Bassett Furniture (BSET)
NASDAQ:BSET
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Bassett Furniture
(NASDAQ:BSET)
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Rating:57Neutral
Price Target:
$16.50
▲(0.61% Upside)
Action:ReiteratedDate:02/06/26
The score is driven by a stabilizing financial recovery (return to profitability in 2025, improving cash flow, solid gross margins and manageable leverage) and a cautiously constructive earnings outlook supported by strong liquidity and digital momentum. These are tempered by weak technical momentum, tariff-related margin pressure and backlog declines, and a valuation that is only moderately supported by the high dividend given recent earnings volatility.
Positive Factors
Structurally solid gross margins
Bassett’s consistently strong gross margins (low‑to‑mid 50s) indicate durable product pricing power and cost structure for its furniture categories. This margin base supports operating leverage when volumes recover, helping protect profitability and cash generation across cycles.
Strong liquidity and low leverage
A debt‑free balance sheet with meaningful cash reserves and improved leverage (~0.54) gives Bassett flexibility to fund growth, weather tariff or demand shocks, fund planned CapEx, and sustain dividends/buybacks without urgent refinancing, supporting strategic optionality over months.
Channel diversification & digital momentum
Sustained e‑commerce growth and expanding custom/partner channels diversify sales beyond brick‑and‑mortar. Higher online conversion and Custom Studio scale improve customer reach, reduce reliance on single channels, and create durable revenue streams that can compound over 2–6 months.
Negative Factors
Volatile revenue and earnings
The company’s history of sharp top‑line swings and thin, inconsistent net margins reduces predictability of earnings and cash conversion. This volatility can constrain investment planning, raise the cost of capital, and make sustained dividend/buyback policies harder to maintain if fundamentals reverse.
Tariff-driven margin pressure & backlog declines
Absorbing tariff surcharges materially compressed retail margins and backlogs have fallen, reducing near‑term revenue visibility. Persistent trade/tariff uncertainty could force repeated margin concessions or more aggressive price increases, undermining structural profitability over coming quarters.
Modest free cash flow vs rising CapEx needs
With only modest annual free cash flow and materially higher planned CapEx, Bassett faces tighter internal funding for growth or returns. Over 2–6 months this can constrain discretionary spending or force tradeoffs among store openings, inventory, and shareholder returns if cash generation slips.
Bassett Furniture (BSET) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$126.27M
Dividend Yield4.59%
Average Volume (3M)25.04K
Price to Earnings (P/E)20.8
Beta (1Y)0.36
Revenue Growth-2.74%
EPS GrowthN/A
CountryUS
Employees1,228
SectorConsumer Cyclical
Sector Strength84
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)0.18
Shares Outstanding8,654,370
10 Day Avg. Volume32,440
30 Day Avg. Volume25,043
Financial Highlights & Ratios
PEG Ratio-0.14
Price to Book (P/B)0.82
Price to Sales (P/S)0.40
P/FCF Ratio15.04
Enterprise Value/Market Cap1.97
Enterprise Value/Revenue0.74
Enterprise Value/Gross Profit1.32
Enterprise Value/Ebitda13.15
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.1
Revenue Forecast (FY)$344.79M
Bassett Furniture Business Overview & Revenue Model
Company DescriptionBassett Furniture Industries, Incorporated engages in the manufacture, marketing, and retail of home furnishings in the United States and internationally. It operates through three segments: Wholesale, Retail company-owned Stores, and Logistical Services. The company engages in the design, manufacture, sourcing, sale, and distribution of furniture products to a network of company-owned retail stores and licensee-owned stores, and independent furniture retailers; and wood and upholstery operations. As of November 27, 2021, it operated a network of 63 company-owned stores and 34 licensee-owned stores. It also provides shipping, and warehousing services to customers in the furniture industry. In addition, the company owns and leases retail store properties; and distributes its products through other multi-line furniture stores, Bassett galleries or design centers, mass merchants, and specialty stores, as well as sells its products online. Bassett Furniture Industries, Incorporated was incorporated in 1902 and is based in Bassett, Virginia.
How the Company Makes MoneyBassett Furniture generates revenue primarily through the sale of its furniture products, which include both standard and custom-made items. The company operates a dual revenue model – direct sales through its own retail stores and wholesale distribution to independent retailers. Key revenue streams include in-store sales, online sales, and custom orders, which allow customers to personalize their furniture selections. Additionally, Bassett has established partnerships with various suppliers and manufacturers to enhance its product offerings and streamline production processes. The company also benefits from seasonal promotions and financing options that encourage customer purchases, further contributing to its earnings.
Bassett Furniture Key Performance Indicators (KPIs)
Bassett Furniture Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Mar 26, 2026
Earnings Call Sentiment Positive
The call presents a cautiously positive picture: the company delivered top-line growth across consolidated, wholesale and retail channels, strong digital momentum, product-led wins (notably wood/case goods and custom upholstery), and improved operating income while maintaining a debt-free balance sheet and healthy cash. However, margin pressure—especially in retail driven by tariff absorption—declining backlogs, EPS volatility, modest free cash flow, and near-term disruptions (weather, tariff uncertainty, Lane Venture timing) temper the outlook. Management is emphasizing continued cost discipline, product innovation, selective store expansion and higher planned CapEx for 2026.Q4-2025 Updates
Positive Updates
Consolidated Revenue Growth
Consolidated revenue increased 5.1% year-over-year; excluding the impact of last year's Noah Home closure, consolidated revenues were up 6.4%.
Wholesale and Retail Sales Expansion
Wholesale sales rose 8.3% and retail sales increased 7.9% in the quarter. Shipments to the company's retail store network grew 14%, and shipments to the open market rose 3.4%.
Strong Product & Category Momentum
Wood/case goods offerings saw sales increase over 50% in the quarter; custom leather upholstery sales were up 19%. New lines (Copenhagen, Homework home office, US-made solid dining, Z4 sleeper) showed strong reception.
E-commerce and Digital Performance
E-commerce sales were up 14% in the quarter and up 27% for the full year; online conversion rates improved by double digits.
Operating Income Improvement
Operating income improved to $2.3 million (2.6% of sales) versus $0.9 million in the prior year quarter. Excluding impairments and restructuring-related costs, operating income was $2.8 million (3.2% of sales) versus $2.3 million (2.8%).
SG&A Leverage and Cost Savings
Selling, general & administrative expenses improved to 53.2% of sales (60 basis points lower year-over-year), with wholesale SG&A down ~50 bps and retail SG&A down ~180 bps due to restructuring, efficiencies and fixed-cost leverage.
Balance Sheet Strength and Cash Generation
Company ended the quarter with $59.2 million of cash and short-term investments, no debt, generated $7.8 million of operating cash flow in the quarter and $13.5 million for the year; cash and short-term investments increased $4.6 million in the quarter.
Strategic Channel & Footprint Progress
Bassett Custom Studio partners reached 57; Bassett Design Center sales up 5% and Custom Studio sales up 21%. Plans to open Cincinnati and Orlando stores in fiscal 2026 and continue opening ~2–4 stores per year.
Capital Allocation and Shareholder Returns
Board approved a regular $0.20 quarterly dividend; Q4 cash returns included $1.7M in dividends and $0.6M in share repurchases. Company intends opportunistic buybacks and plans higher CapEx for growth ($8–$12M forecast for 2026).
Negative Updates
EPS Decline and Comparison Distortions
Diluted earnings per share were $0.18 in 2025 versus $0.38 in the prior-year quarter. The prior-year quarter included a $2.6M tax benefit; excluding that benefit 2024 EPS would have been $0.08, highlighting volatility and comparisons that complicate EPS interpretation.
Consolidated and Retail Margin Pressure
Consolidated gross margin declined 30 basis points to 56.3%. Retail gross margin declined 150 basis points in the quarter primarily because management held retail prices while absorbing tariff surcharges.
Backlog Contraction
Wholesale backlog decreased to $19.5 million from $21.8 million a year ago; retail backlog declined to $34.4 million from $37.1 million on November 30, 2024.
Tariff-Driven Uncertainty and Margin Actions
Tariff volatility forced the company to absorb surcharges in Q4 (hitting retail margins) and adjust pricing only on January 1, 2026. Management notes ongoing tariff uncertainty which could require further action.
Lane Venture Timing Impact
Shipments for Lane Venture decreased 13% in the quarter due to timing of imported goods, despite an actual order rate increase of 34%, creating short-term revenue recognition and fulfillment timing issues.
Modest Free Cash Flow and Increased CapEx Needs
Free cash flow for the year was $2.0 million, modest relative to cash balances. Forecasted capital expenditures of $8–$12 million for 2026 (vs. $4.5M spent this year) will raise near-term cash deployment needs.
Operational Disruptions and Weather Headwinds
Severe weather early in fiscal 2026 forced temporary closure of many stores (40 closed during an ice weekend), disrupting written sales momentum and creating short-term demand uncertainty for the upcoming quarter.
Headcount Reductions and Ongoing Restructuring
Headcount was reduced by about 11% last year and an additional 4% recently, reflecting ongoing restructuring and cost cuts which could impact capacity and growth execution if demand improves unexpectedly.
Warranty and Returns Adjustment
Wholesale gross margin gains were partially offset by an unfavorable warranty and returns adjustment, indicating some product/service quality or post-sale cost pressures.
Company Guidance
Management said fiscal 2026 is expected to resemble 2025 and emphasized running a leaner business while monitoring tariffs, with specific actions including opening three new stores (Cincinnati in Q2, Orlando in Q3 and a third planned), relocating Long Island to Melville in September, forecasting $8–$12 million of CapEx (vs. $4.5M in FY2025), continuing a regular 20¢ quarterly dividend payable Feb. 27 and opportunistic buybacks (Q4 buybacks $0.6M; Q4 dividends $1.7M). They reiterated growth priorities — e‑commerce (up 14% in Q4, +27% FY with double‑digit conversion gains), Bassett Design Centers (+5% Q4), Bassett Custom Studios (+21% Q4; 57 partners) and a new Bassett Hospitality push — while preserving liquidity ($59.2M cash & short‑term investments, no debt), generating $7.8M operating cash flow in the quarter ($13.5M FY; $2.0M free cash flow FY), and managing headcount reductions of 11% last year and a further 4% recently; backlogs at 11/29/25 were $19.5M wholesale and $34.4M retail.Bassett Furniture Financial Statement Overview
Summary
Results show a cyclical trough-and-recovery pattern: losses in 2023–2024 improved to a small profit in 2025 (~1.8% net margin). Gross margin remains structurally solid (mid-50s), leverage is manageable and improved, and cash flow improved in 2025 (positive free cash flow). Offsetting this are volatile revenue, thin/unstable bottom-line performance versus 2022, and a cash-flow track record that has been inconsistent.Income Statement
Revenue has been volatile, falling sharply in 2023 and stabilizing with a modest rebound in 2025 (annual revenue growth swung from -19.7% in 2023 to +1.3% in 2025). Profitability also shows a clear trough-and-recovery pattern: losses in 2023–2024 (negative net margins) turned back to a small profit in 2025 (~1.8% net margin). A key strength is consistently solid gross margin (low-to-mid 50s), but the weakness is thin and unstable bottom-line performance versus the strong 2022 peak, indicating operating leverage and demand sensitivity.55
Neutral
Balance Sheet
Leverage appears manageable with debt-to-equity generally in the ~0.54–0.82 range, improving to ~0.54 in 2025, which supports financial flexibility. However, returns on equity have been inconsistent (strongly positive in 2021–2022, negative in 2023–2024, and only modestly positive in 2025), reflecting earnings volatility. Overall, the balance sheet looks adequate for the cycle, but profitability swings remain the main balance-sheet risk factor.62
Positive
Cash Flow
Cash generation is mixed. Operating cash flow and free cash flow improved materially in 2025 (positive free cash flow of ~$9.0M versus negative in 2024), and 2023–2025 show generally positive operating cash flow. The weakness is inconsistency across the period (notably negative operating cash flow and deeply negative free cash flow in 2022), plus relatively low conversion in some years as operating cash flow has been modest relative to revenue. Overall cash flow is improving recently, but the track record is not yet steady.58
Neutral
| Breakdown | Nov 2025 | Nov 2024 | Nov 2023 | Nov 2022 | Nov 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 335.28M | 329.92M | 390.14M | 485.60M | 430.89M |
| Gross Profit | 188.68M | 179.41M | 206.49M | 248.34M | 221.09M |
| EBITDA | 17.61M | -4.42M | 7.67M | 44.14M | 37.39M |
| Net Income | 6.10M | -9.70M | -3.17M | 65.34M | 18.04M |
Balance Sheet | |||||
| Total Assets | 348.71M | 341.17M | 370.42M | 406.27M | 421.66M |
| Cash, Cash Equivalents and Short-Term Investments | 59.24M | 59.91M | 70.18M | 79.34M | 52.09M |
| Total Debt | 158.00M | 106.44M | 116.18M | 116.30M | 133.53M |
| Total Liabilities | 183.61M | 173.84M | 186.98M | 210.66M | 258.93M |
| Stockholders Equity | 165.11M | 167.33M | 183.44M | 195.61M | 162.73M |
Cash Flow | |||||
| Free Cash Flow | 8.96M | -1.16M | 1.24M | -24.27M | 3.81M |
| Operating Cash Flow | 13.49M | 4.05M | 18.72M | -2.97M | 14.56M |
| Investing Cash Flow | -2.73M | -8.77M | -17.76M | 65.84M | -11.57M |
| Financing Cash Flow | -9.04M | -8.12M | -10.23M | -35.56M | -14.42M |
Bassett Furniture Technical Analysis
Negative
16.40
Price Trends
16.12
Negative
15.52
Negative
15.75
Negative
Market Momentum
-0.31
Positive
35.49
Neutral
11.61
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BSET, the sentiment is Negative. The current price of 16.4 is above the 20-day moving average (MA) of 15.40, above the 50-day MA of 16.12, and above the 200-day MA of 15.75, indicating a bearish trend. The MACD of -0.31 indicates Positive momentum. The RSI at 35.49 is Neutral, neither overbought nor oversold. The STOCH value of 11.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BSET.
Bassett Furniture Risk Analysis
Bassett Furniture disclosed 9 risk factors in its most recent earnings report. Bassett Furniture reported the most risks in the "Ability to Sell" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bassett Furniture Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $584.50M | 13.36 | 9.21% | 7.86% | -4.26% | ― | |
65 Neutral | $1.44B | 17.51 | 8.11% | 2.39% | 1.78% | -25.36% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
59 Neutral | $1.45B | ― | -1.95% | 4.16% | 4.34% | -141.36% | |
57 Neutral | $126.27M | 20.79 | 4.70% | 4.59% | -2.74% | ― | |
54 Neutral | $152.83M | -5.04 | -11.27% | 7.20% | -12.09% | -204.66% | |
48 Neutral | $186.19M | -2.32 | ― | ― | -16.95% | -88.00% |
* Consumer Cyclical Sector Average
BSET
Bassett Furniture
15.19
0.39
2.66%
ETD
Ethan Allen
23.03
-3.93
-14.57%
MLKN
MillerKnoll
20.84
-0.55
-2.59%
HOFT
Hooker Furniture
14.24
2.08
17.11%
LZB
La-Z-Boy Incorporated
35.92
-8.67
-19.43%
SNBR
Sleep Number
7.91
-7.06
-47.16%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.