Torrid Holdings (CURV) AI Stock Analysis

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Torrid Holdings

(NYSE:CURV)

Rating:52Neutral

Price Target:

$6.00

▲( 8.50% Upside)

Torrid Holdings faces significant financial challenges, particularly with high leverage and declining revenues. While technical indicators and earnings call insights provide some optimism with strategic initiatives and improved cash flow, the high P/E ratio raises valuation concerns. Overall, the stock's performance is in a moderate range, reflecting both potential and risk.

Positive Factors

Product Innovation

The company plans to launch more new products and collections in the first half of the year than it has in the last six years, indicating a significant increase in product flow.

Sales Strategy

Torrid CEO Lisa Harper's approach focuses on great product and compelling sales strategies to engage new and existing customers.

Negative Factors

Market Environment

Apparel retail turnarounds are nearly unprecedented historically and likely prove even more difficult in a challenged macro environment.

Product Resonance Risk

The largest risk is a potential delay in recovery or failure of new products to resonate, which could be exacerbated by a worsening demand environment.

Torrid Holdings (CURV) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$592.57M

Dividend YieldN/A

Average Volume (3M)226.76K

Price to Earnings (P/E)35.9

Beta (1Y)0.92

Revenue Growth-4.18%

EPS Growth39.43%

CountryUS

Employees1,810

SectorConsumer Cyclical

Sector Strength72

IndustryApparel - Retail

Share Statistics

EPS (TTM)-0.03

Shares Outstanding104,326,520

10 Day Avg. Volume194,221

30 Day Avg. Volume226,763

Financial Highlights & Ratios

PEG Ratio2.38

Price to Book (P/B)-2.94

Price to Sales (P/S)0.00

P/FCF Ratio10.92

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$5.45

Price Target Upside-1.45% Downside

Rating ConsensusHold

Number of Analyst Covering5

Torrid Holdings Business Overview & Revenue Model

Company DescriptionTorrid Holdings Inc. operates in women's plus-size apparel and intimates market in North America. The company designs, develops, and merchandises its products under the Torrid and Torrid Curve brand names. It is involved in the sale of tops, bottoms, dresses, denims, activewear, intimates, sleep wear, swim wear, and outerwear products; and non-apparel products comprising accessories, footwear, and beauty products. The company sells its products directly to consumers through its e-commerce platform and its physical stores. As of January 29, 2022, it operated 624 stores in 50 U.S. states, Puerto Rico, and Canada. Torrid Holdings Inc. was incorporated in 2019 and is headquartered in City of Industry, California.

How the Company Makes MoneyTorrid Holdings generates revenue primarily through the sale of its plus-size fashion products. The company's revenue streams are driven by its network of retail stores and e-commerce platform, which together offer an integrated shopping experience for customers. Torrid's physical stores serve as both sales channels and brand touchpoints, enhancing customer engagement and loyalty, while its online platform expands its market reach beyond geographic limitations. Additionally, Torrid benefits from strategic marketing initiatives and loyalty programs that encourage repeat purchases. The company's focus on a specific demographic allows it to maintain a dedicated customer base, which is essential for its sustained revenue growth. Furthermore, Torrid may engage in partnerships or collaborations with fashion influencers and designers to boost brand visibility and attract new customers.

Torrid Holdings Financial Statement Overview

Summary

The company faces challenges with declining revenues, negative equity, and high debt levels. While profitability margins show some improvement, overall financial health is strained. Positive cash flow trends highlight operational efficiency, but financial leverage and equity deficits remain concerns.

Income Statement

Neutral

The income statement shows a declining revenue trend from $1.29 billion in 2023 to $1.12 billion in TTM (Trailing-Twelve-Months) 2024. Gross profit margins decreased from 35.7% in 2022 to 37.5% in TTM 2024, indicating a slight improvement. The net profit margin improved to 1.36% in TTM 2024 from a negative margin in 2022. However, revenue growth is negative, and overall profitability remains a concern.

Balance Sheet

Neutral

The balance sheet reveals negative stockholders' equity, worsening from -$63.17 million in 2021 to -$189.29 million in TTM 2024, indicating financial instability. The debt-to-equity ratio is not meaningful due to negative equity, and high debt levels pose a risk. ROE is negative due to negative equity, underscoring profitability issues. The equity ratio is also negative, reflecting leverage concerns.

Cash Flow

Neutral

The cash flow statement shows positive operating cash flow of $74.41 million in TTM 2024, up from $42.77 million in 2023, highlighting operational efficiency improvements. Free cash flow increased significantly from $16.77 million in 2023 to $51.02 million in TTM 2024. However, the free cash flow to net income ratio indicates reliance on operational cash flow to cover financial obligations, with potential sustainability issues.

TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Breakdown
Income Statement		Total Revenue
1.12B	1.15B	1.29B	1.28B	973.51M	1.04B
	Gross Profit
420.39M	405.98M	459.54M	518.97M	330.30M	396.07M
	EBIT
57.77M	57.15M	101.63M	45.38M	56.82M	76.99M
	EBITDA
119.53M	92.05M	181.06M	123.78M	131.76M	148.79M
	Net Income Common Stockholders
15.24M	11.62M	50.21M	-29.94M	24.53M	41.87M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
13.57M	11.73M	13.57M	29.02M	122.95M	28.80M
	Total Assets
527.26M	476.95M	527.26M	578.50M	648.21M	635.99M
	Total Debt
547.43M	311.97M	546.33M	599.17M	502.37M	583.69M
	Net Debt
533.86M	300.23M	532.76M	570.14M	379.42M	554.88M
	Total Liabilities
757.49M	688.66M	757.49M	836.82M	711.38M	731.49M
	Stockholders Equity
-230.22M	-211.72M	-230.22M	-258.32M	-63.17M	-95.50M
Cash Flow		Free Cash Flow
51.02M	16.77M	29.94M	103.67M	140.25M	72.76M
	Operating Cash Flow
74.41M	42.77M	53.31M	121.22M	151.82M	99.09M
	Investing Cash Flow
-23.39M	-26.00M	-23.37M	-17.55M	-11.57M	-56.12M
	Financing Cash Flow
-22.55M	-18.52M	-45.12M	-197.81M	-45.92M	-23.34M

Torrid Holdings Technical Analysis

Technical Analysis Sentiment

Negative

Last Price5.53

Price Trends

50DMA

5.54

Negative

100DMA

5.81

Negative

200DMA

5.27

Positive

Market Momentum

MACD

-0.03

Positive

RSI

42.41

Neutral

STOCH

27.29

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CURV, the sentiment is Negative. The current price of 5.53 is below the 20-day moving average (MA) of 5.79, below the 50-day MA of 5.54, and above the 200-day MA of 5.27, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 42.41 is Neutral, neither overbought nor oversold. The STOCH value of 27.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CURV.

Torrid Holdings Risk Analysis

Torrid Holdings disclosed 43 risk factors in its most recent earnings report. Torrid Holdings reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Torrid Holdings Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GES	73 Outperform	$593.45M	14.84	10.01%	10.86%	7.88%	-68.39%
SCVL	70 Outperform	$550.18M	7.51	11.97%	2.86%	2.30%	0.88%
Sector *	62 Neutral	$6.88B	11.26	2.78%	3.93%	2.65%	-22.00%
SFIX	61 Neutral	$552.54M	―	-34.37%	―	-13.14%	44.84%
CURV	52 Neutral	$592.57M	35.89		―	-4.18%	39.43%
YSG	50 Neutral	$449.11M	―	-16.81%	―	-2.11%	-6.49%
LE	48 Neutral	$276.08M	43.11	2.59%	―	-7.44%	―

* Consumer Cyclical Sector Average

Performance Comparison

CURV

Torrid Holdings

5.30

-0.61

-10.32%

GES

Guess?

11.10

-10.78

-49.27%

SCVL

Shoe Carnival

19.51

-16.09

-45.20%

Lands' End

8.95

-5.01

-35.89%

SFIX

Stitch Fix

4.29

2.05

91.52%

YSG

Yatsen Holding

4.93

1.65

50.30%

Torrid Holdings Earnings Call Summary

Earnings Call Date:Mar 20, 2025

(Q4-2024)

% Change Since: 0.00%|

Next Earnings Date:Jun 05, 2025

Earnings Call Sentiment Neutral

Torrid Holdings showed resilience and strategic growth through the successful launch of new sub-brands, improved financial positioning, and strategic store optimization. However, challenges in the macro environment and a decline in net sales present ongoing concerns. Despite these challenges, the positive developments in product offerings and financial health suggest cautious optimism for the future.

Q4-2024 Updates

Positive Updates

Successful Launch of Sub-Brands

Three new sub-brands launched successfully in Q4, driving excitement and engagement among new and existing customers. These sub-brands are attracting younger customers, with new buyers averaging in their mid-30s.

Improved Financial Position

Torrid ended fiscal 2024 with $48.5 million in cash, an increase of $36.8 million year-over-year, and total liquidity of $158 million. Operating cash flow increased by 2x to $77.4 million from the previous year.

Positive Response to Product Assortments

Positive customer response to holiday and early spring lines, with newness across the product portfolio leading to improved regular price comp trends, which increased by 1.6%.

Strategic Store Optimization

Successfully closed 35 stores in fiscal 2024, with plans to close an additional 40 to 50 stores in fiscal 2025, optimizing retail footprint and reducing fixed costs.

Negative Updates

Challenging Macro Environment

Uncertainty in the consumer and macro environment led to choppy business performance in early Q4, driven by macro factors and adverse weather in February.

Decline in Net Sales

Net sales for Q4 totaled $275.6 million, a decrease from $293.5 million last year, with a comparable sales decline of 0.8%.

Impact of Store Closures

Store closures in fiscal 2024 impacted sales, and further closures planned for fiscal 2025 may continue to affect revenues.

Company Guidance

During the Torrid Holdings Fourth Quarter Fiscal 2024 Earnings Conference Call, several key financial metrics and strategic initiatives were discussed. Torrid achieved sales of $275.6 million and an adjusted EBITDA of $16.7 million for the quarter. The company ended fiscal 2024 with $48.5 million in cash, marking an increase of $36.8 million from the previous year. Inventory levels rose by 4% due to higher in-transit levels, but showed an 18% decrease over two years. For fiscal 2025, Torrid aims to close 40 to 50 underperforming stores while opening 4 to 8 new locations, focusing on outdoor shopping centers. The fiscal 2025 guidance projects sales between $1.080 billion and $1.100 billion and adjusted EBITDA between $100 million and $110 million. The company aims to capitalize on its new sub-brands, which are expected to account for 7% to 10% of total receipt investment, and plans to continue optimizing its product assortment, customer growth, and store fleet.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.