The Lovesac Company (LOVE) AI Stock Analysis

• Market Cap: $269.45M
• Dividend Yield: N/A
• Average Volume (3M): 254.97K
• Price to Earnings (P/E): 26.4
• Beta (1Y): 2.09
• Revenue Growth: -0.77%
• EPS Growth: -8.89%
• Country: US
• Employees: 920
• Sector: Consumer Cyclical
• Sector Strength: 82
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.73
• Shares Outstanding: 14,549,118
• 10 Day Avg. Volume: 320,258
• 30 Day Avg. Volume: 254,967
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.71
• Enterprise Value/Revenue: 0.68
• Enterprise Value/Gross Profit: 1.17
• Enterprise Value/Ebitda: 16.25
• 1Y Price Target: $28.00
• Price Target Upside: 51.19% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 65 Neutral
• Price Target: $20.00 ▲(7.99% Upside)

The Lovesac Company's overall stock score reflects a balance of strong financial performance and positive earnings call sentiment, tempered by technical analysis signals and valuation concerns. The company's strategic focus on innovation and market expansion, alongside recent corporate governance enhancements, supports a moderately positive outlook.

Positive Factors

Product Innovation

The introduction of new products like Evercouch and Recliner, alongside target marketing, is expected to drive improved performance in the second half of the fiscal year.

Sales Growth

Lovesac's net sales increased ~4% y/y to ~$138M in fiscal 1Q26, driven by a 3% increase in omni-channel comparable net sales and the net addition of 21 new showrooms.

Valuation

The company's valuation is considered attractive at current levels, trading at a lower multiple compared to the peer average, supporting the Buy rating.

Negative Factors

Gross Margins

Profitability was below consensus, reflecting softer-than-expected gross margins as the company works through China-based inventory.

Guidance

F2Q guidance for The Lovesac Company misses expectations.

Profitability

The company's profitability metrics for the upcoming quarter are below expectations, impacting the stock negatively.

The Lovesac Company Business Overview & Revenue Model

Company Description

The Lovesac Company (LOVE) is a retail furniture company specializing in premium modular seating and home furnishings. Founded in 1995, the company operates primarily in the home goods sector, offering innovative products such as the Sactional, a customizable sectional sofa, and the Sac, a foam-filled bean bag chair. Lovesac emphasizes sustainability, utilizing environmentally friendly materials in its products, and aims to create versatile, long-lasting furniture that adapts to modern living spaces.

How the Company Makes Money

The Lovesac Company generates revenue through the direct sale of its furniture products, primarily through its online platform and retail showrooms. Key revenue streams include the sales of Sactionals, Sacs, and associated accessories. The company also benefits from a growing online presence, which has been bolstered by its e-commerce strategy, allowing for a wider customer reach. Additionally, Lovesac engages in partnerships with various home design and lifestyle brands, enhancing its product offerings and marketing efforts. The focus on high-quality, customizable products allows Lovesac to command premium pricing, contributing significantly to its overall earnings.

The Lovesac Company Financial Statement Overview

Summary

The Lovesac Company shows strong profitability and efficient cash flow management. However, increased leverage and recent revenue decline pose potential risks. Continued focus on revenue growth and managing debt levels will be crucial for sustaining financial stability.

Income Statement

The company's income statement shows strong profitability with a consistent gross profit margin over the years. The net profit margin has improved significantly since 2020, indicating better cost management. However, revenue growth has been volatile, with a decline in the most recent year. The EBIT and EBITDA margins remain healthy, supporting overall profitability.

Balance Sheet

The balance sheet reflects moderate financial health. The debt-to-equity ratio has increased, suggesting higher leverage and potential risk. Return on equity is positive, indicating efficient use of shareholder funds. The equity ratio is stable, reflecting a solid financial foundation, although the increasing liabilities warrant close monitoring.

Cash Flow

Cash flow analysis reveals a strong free cash flow growth in recent years, recovering from previous negative figures. The operating cash flow to net income ratio is favorable, indicating effective cash generation from operations. However, the free cash flow to net income ratio shows some volatility, suggesting potential challenges in capital expenditure management.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	680.63M	680.63M	700.26M	651.18M	498.24M	320.74M
Gross Profit	394.33M	397.83M	401.04M	343.65M	273.53M	174.77M
EBITDA	28.36M	28.36M	42.68M	47.81M	48.44M	21.49M
Net Income	11.56M	11.56M	23.86M	26.49M	47.49M	14.73M
Balance Sheet
Total Assets	532.25M	532.25M	482.18M	408.63M	369.08M	171.02M
Cash, Cash Equivalents and Short-Term Investments	83.73M	83.73M	87.04M	43.53M	92.39M	78.34M
Total Debt	183.02M	183.02M	175.50M	146.57M	108.51M	0.00
Total Liabilities	315.89M	315.89M	264.68M	215.53M	211.27M	63.07M
Stockholders Equity	216.35M	216.35M	217.50M	193.09M	157.81M	107.95M
Cash Flow
Free Cash Flow	17.46M	17.46M	47.23M	-46.92M	17.53M	31.47M
Operating Cash Flow	38.98M	38.98M	76.44M	-21.38M	32.65M	40.52M
Investing Cash Flow	-21.52M	-21.52M	-29.21M	-25.55M	-15.12M	-9.05M
Financing Cash Flow	-20.76M	-20.76M	-3.73M	-1.94M	-3.48M	-1.67M

The Lovesac Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 18.52
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOVE, the sentiment is Negative. The current price of 18.52 is below the 20-day moving average (MA) of 18.56, below the 50-day MA of 18.62, and below the 200-day MA of 22.15, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 48.54 is Neutral, neither overbought nor oversold. The STOCH value of 37.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOVE.

The Lovesac Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLXS	72 Outperform	$240.48M	13.02	12.67%	1.56%	6.86%	88.42%
KEQU	70 Outperform	$165.12M	14.63	19.13%	―	18.02%	-38.98%
LOVE	65 Neutral	$269.45M	26.38	6.73%	―	-0.77%	-8.89%
Sector *	61 Neutral	$17.75B	12.51	-5.49%	3.06%	1.43%	-14.10%
BSET	58 Neutral	$148.07M	62.59	1.46%	4.69%	-7.22%	―
SNBR	52 Neutral	$246.84M	―	9.10%	―	-14.40%	-2.14%
HOFT	47 Neutral	$108.84M	―	-5.55%	9.04%	-3.89%	-391.05%

The Lovesac Company Corporate Events

The Lovesac Company Appoints Alan Boehme to Board

On August 27, 2025, The Lovesac Company announced the appointment of Alan Boehme to its Board of Directors. Boehme, a seasoned technology and business leader, brings over three decades of experience in consumer goods, retail, and manufacturing, having worked with major brands like H&M Group and Coca-Cola. His expertise in digital transformation and retail technology aligns with Lovesac’s growth objectives and innovative business model, potentially enhancing the company’s operations and market positioning.

Lovesac Receives Preliminary Approval for Settlement

On June 3, 2025, the United States District Court for the District of Connecticut granted preliminary approval for a proposed settlement in the consolidated derivative actions involving The Lovesac Company. The settlement addresses claims of fiduciary breaches and other misconduct by Lovesac’s officers and directors related to financial misstatements and internal control weaknesses. If approved, the settlement will result in corporate governance reforms and the release of all related claims, providing substantial benefits to Lovesac and its shareholders.

Lovesac Elects Board Directors, Fails Compensation Approval

At the 2025 Annual Meeting of Stockholders held on June 10, 2025, The Lovesac Company elected six directors to its Board, with Shawn Nelson receiving the highest votes. However, the advisory approval for the fiscal 2025 compensation for named executive officers was not passed, while the appointment of Deloitte & Touche LLP as the independent auditor for the fiscal year ending February 1, 2026, was ratified.