THG (THG) AI Stock Analysis

• Market Cap: £763.65M
• Dividend Yield: N/A
• Average Volume (3M): 6.85M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.58
• Revenue Growth: -20.36%
• EPS Growth: 44.33%
• Country: UK
• Employees: 6,797
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): -0.05
• Shares Outstanding: 1,599,781,100
• 10 Day Avg. Volume: 6,451,997
• 30 Day Avg. Volume: 6,852,398
• PEG Ratio: -0.07
• Price to Book (P/B): 2.01
• Price to Sales (P/S): 0.35
• P/FCF Ratio: 21.24
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £47.33
• Price Target Upside: 8.56% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: 48.00p ▲(10.09% Upside)

THG's overall stock score reflects a mix of significant financial challenges and positive strategic developments. The financial performance is the most critical factor, with high leverage and ongoing losses weighing heavily. However, technical indicators and corporate events show positive momentum and strategic growth, providing a more optimistic outlook.

Positive Factors

Debt Reduction

Reducing debt and extending facilities enhance financial stability, providing more flexibility for strategic investments and growth.

Nutrition Division Growth

Growth in the Nutrition division indicates strong market demand and successful expansion strategies, supporting long-term revenue growth.

Brand Expansion

The successful rebranding and expansion of Myprotein enhance brand recognition and market penetration, driving future sales.

Negative Factors

Revenue Decline

A decline in group revenue suggests challenges in maintaining sales momentum, potentially affecting long-term financial performance.

High Input Costs

Rising input costs can erode profit margins, making it difficult to sustain profitability and affecting competitive positioning.

High Leverage

High leverage increases financial risk, limiting the company's ability to invest in growth opportunities and manage economic downturns.

THG Business Overview & Revenue Model

Company Description

THG (The Hut Group) is a global e-commerce company headquartered in the UK, specializing in health and beauty products, as well as nutrition, and lifestyle brands. The company operates through various online platforms, including its own brands and third-party retailer partnerships, offering a wide range of products such as skincare, cosmetics, sports nutrition, and more. THG also provides a proprietary technology platform, THG Ingenuity, which enables brands to scale their online presence and optimize their e-commerce operations, further solidifying its position in the digital retail space.

How the Company Makes Money

THG generates revenue primarily through direct-to-consumer sales of its own brands and products, as well as through the provision of e-commerce services to third-party brands via its THG Ingenuity platform. Key revenue streams include product sales from its various health and beauty brands, subscription services, and logistics and technology services offered to partners. Significant partnerships with established brands and retailers enhance its market reach, while its investment in technology ensures a scalable and efficient operational model that supports sustained growth and profitability.

THG Financial Statement Overview

Summary

THG faces significant financial challenges with declining revenues, high leverage, and ongoing losses. Improvements in cash flow management are noted, but sustainable profitability remains uncertain.

Income Statement

THG has faced substantial challenges in maintaining profitability, as reflected by negative net income margins over recent years. The revenue has declined from 2023 to 2024 by 14.3%, and a negative EBIT margin further underscores operational challenges. The company has seen inconsistent gross profit margins, indicating difficulties in cost management. While there are signs of improvement in EBITDA margins compared to 2023, overall performance remains fragile.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 2.11 in 2024, suggesting significant leverage which may pose risks. The equity ratio has decreased to 12.0%, indicating reduced financial stability. Return on Equity (ROE) remains negative due to persistent net losses. Despite these challenges, the company has managed to reduce net debt, pointing to some improvement in financial management.

Cash Flow

THG's cash flow statement reveals a positive growth trend in free cash flow, improving from a small positive value in 2023 to 28.99 million in 2024. The operating cash flow to net income ratio suggests that cash flows are more stable than net income figures would suggest. However, the free cash flow to net income remains low, indicating potential issues with converting earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.60B	1.75B	2.05B	2.24B	2.18B	1.61B
Gross Profit	659.89M	693.60M	840.29M	771.00M	855.37M	655.91M
EBITDA	-48.37M	-48.64M	42.42M	-289.44M	32.07M	-376.33M
Net Income	-128.64M	-326.14M	-248.37M	-539.96M	-138.07M	-532.63M
Balance Sheet
Total Assets	1.62B	2.55B	2.78B	3.09B	3.42B	2.45B
Cash, Cash Equivalents and Short-Term Investments	129.41M	309.35M	416.16M	473.78M	536.83M	773.58M
Total Debt	601.39M	645.94M	995.01M	1.01B	839.04M	762.34M
Total Liabilities	1.20B	2.24B	1.76B	1.79B	1.67B	1.30B
Stockholders Equity	424.12M	305.83M	1.02B	1.30B	1.76B	1.14B
Cash Flow
Free Cash Flow	53.16M	28.99M	16.15M	-164.27M	-190.88M	-198.98M
Operating Cash Flow	70.53M	96.46M	141.81M	12.15M	-1.71M	40.39M
Investing Cash Flow	-57.14M	-92.11M	-77.14M	-182.11M	-959.06M	-351.32M
Financing Cash Flow	-66.40M	-22.91M	-122.29M	106.92M	724.01M	772.28M

THG Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 43.60
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:THG, the sentiment is Neutral. The current price of 43.6 is below the 20-day moving average (MA) of 44.52, below the 50-day MA of 44.71, and above the 200-day MA of 34.14, indicating a neutral trend. The MACD of 0.16 indicates Positive momentum. The RSI at 45.28 is Neutral, neither overbought nor oversold. The STOCH value of 20.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:THG.

THG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CARD	76 Outperform	£243.25M	5.69	13.18%	6.97%	6.18%	4.22%
AO	63 Neutral	£612.13M	52.10	7.52%	―	13.21%	-54.35%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
THG	60 Neutral	£763.65M	-4.36	-18.75%	―	-20.36%	44.33%
ASC	59 Neutral	£329.66M	-1.10	-81.34%	―	-14.89%	12.08%
MOON	56 Neutral	£640.92M	14.29	―	1.40%	3.94%	―
DEBS	46 Neutral	£266.52M	-1.33	-172.24%	―	-65.42%	27.73%

THG Corporate Events

THG PLC Announces Admission of Convertible Loan Shares

THG PLC has announced the admission of 209,086,407 Ordinary Shares to trading on the London Stock Exchange and the FCA’s Official List, following a convertible loan agreement with FIC ShareCo Limited. This move increases the total voting rights in the company to 1,599,781,137, impacting shareholder calculations under the Disclosure Guidance and Transparency Rules.

THG PLC Announces Internal Share Transfer with No Change in Ownership

THG PLC announced a share transfer involving 181,818,181 ordinary voting shares at a price of 44 pence each, between two companies controlled by CEO Matthew Moulding. This internal transfer does not alter Moulding’s equity interest in THG PLC, maintaining the status quo in terms of ownership and control, and complies with UK Market Abuse Regulation.

Myprotein Partners with Mars for New Snickers-Flavored Protein Range

Myprotein, part of THG Nutrition, has announced a collaboration with Mars to launch Snickers-flavored protein powders and Mars-branded protein bars. This partnership is part of Myprotein’s strategy to expand its market presence, aiming to sell 45 million units globally by the end of 2025, and highlights the brand’s commitment to innovation and market differentiation.

THG PLC Announces New Board Appointment

THG PLC has announced that Gillian Kent, an independent Non-Executive Director, will join Crest Nicholson Holdings plc as a non-executive director starting 1 November 2025. This appointment reflects THG’s strategic focus on strengthening its leadership team and enhancing its influence in the industry, potentially impacting its market positioning and stakeholder relations.

THG PLC Reports Strongest Organic Sales Growth Since 2021

THG PLC reported its strongest quarter of organic sales growth since 2021, with a 6.3% increase in Q3 revenue, driven by significant growth in both THG Beauty and THG Nutrition. The company has returned to year-to-date revenue growth, aided by strategic changes and brand investments. Despite the impact of asset disposals and discontinued activities, THG Beauty achieved a 4.2% revenue growth, bolstered by a successful advent launch and strong UK retail momentum. THG Nutrition reported a 10.0% YoY growth, the highest in over two years, with expansion in the US and Middle East markets. The company remains optimistic about meeting its full-year performance expectations, entering its most profitable period.

THG PLC Reports Strongest Organic Sales Growth Since 2021

THG PLC reported its strongest quarter of organic sales growth since 2021, with a 6.3% increase in Q3 revenue, driven by significant growth in THG Nutrition and continued momentum in THG Beauty. Despite the impact of asset disposals and discontinued activities, the company returned to year-to-date revenue growth, positioning itself favorably against its revenue guidance for the second half of 2025. THG Beauty experienced a notable advent sales contribution and growth in UK retail, while THG Nutrition saw its highest revenue growth rate in over two years, supported by online and offline channel expansion and strategic partnerships. The company’s strategic initiatives and operational changes have set a strong foundation for the upcoming key trading period.

THG PLC Reports Interim Results with Strategic Growth in Beauty and Nutrition

THG PLC reported its interim results for the first half of 2025, showing a return to revenue growth in the second quarter, driven by strategic changes in its beauty and nutrition divisions. The company completed a successful demerger of THG Ingenuity and disposed of Claremont Ingredients, which, along with refinancing, improved its net cash position. Despite a slight decline in overall group revenue, THG anticipates stronger performance in the second half, supported by increased brand partnerships and market share gains, particularly in the UK beauty sector and Myprotein’s expansion in offline retail and licensing.

THG PLC to Announce Interim Results for H1 2025

THG PLC announced that it will release its interim results for the six months ending 30 June 2025 on 11 September 2025. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction, potentially impacting its market positioning and investor confidence.