Luvu Brands (LUVU) AI Stock Analysis

• Market Cap: $2.31M
• Dividend Yield: N/A
• Average Volume (3M): 61.79K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.03
• Revenue Growth: 2.37%
• EPS Growth: 23.81%
• Country: US
• Employees: 192
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.01
• Shares Outstanding: 76,834,060
• 10 Day Avg. Volume: 175,295
• 30 Day Avg. Volume: 61,791
• PEG Ratio: -0.80
• Price to Book (P/B): 1.71
• Price to Sales (P/S): 0.17
• P/FCF Ratio: -9.15
• Enterprise Value/Market Cap: 4.42
• Enterprise Value/Revenue: 0.42
• Enterprise Value/Gross Profit: 1.59
• Enterprise Value/Ebitda: 22.40
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 41 Neutral
• Price Target: $0.02 ▼(-20.00% Downside)
• Action: Upgraded Date: 02/21/26
• Date: Action: Upgraded 02/21/26

The score is driven primarily by weak financial performance—recent losses, negative operating/free cash flow, and very high leverage—followed by bearish technicals with the stock below all major moving averages and negative momentum indicators. Valuation is constrained by a negative P/E and no dividend yield data.

Positive Factors

Stable gross margins and positive EBITDA

A ~26% gross margin and positive EBITDA indicate the core product mix retains structural unit profitability. That margin buffer supports recovery scenarios: with modest cost control or volume stabilization, operating profits can scale faster than revenue, aiding durable operational recovery.

Historical run of profitability (2021–2023)

The company delivered strong profitability through 2021–2023, showing the business model can be profitable. This historical track record implies operating leverage and pricing/cost dynamics exist to restore margins if management re-achieves prior revenue or cost structure levels.

Previously positive operating cash generation

Operating and free cash flow were positive in 2022–2024, demonstrating the company can generate cash under better conditions. This past cash-generation ability suggests working-capital levers and operational fixes could re-establish sustainable cash flow over months if revenue or margin trends improve.

Negative Factors

Very high leverage and low equity cushion

A ~6.1x TTM debt-to-equity ratio and only ~$1.5M of equity versus ~$9.35M debt materially constrain financial flexibility. Elevated leverage increases refinancing and interest risk, limiting capacity to absorb shocks, invest in growth, or fund a sustained turnaround without external capital.

Negative operating and free cash flow

Ongoing negative operating and free cash flow signals the business is consuming cash rather than self-funding. That erodes liquidity and raises the probability of covenant stress or the need for dilutive or costly financing, making it harder to execute multi-month restructuring or invest in durable growth.

Sharp revenue decline and persistent net losses

A roughly 53% drop in revenue and a ~-5% net margin reflect weakening demand and squeezed profitability. Sustained top-line contraction undermines operating leverage, makes fixed costs harder to cover, and lengthens the timeline to return to durable profitability without structural demand or product improvements.

Luvu Brands Business Overview & Revenue Model

Company Description

Luvu Brands, Inc. designs, manufactures, and markets various wellness, lifestyle, and casual seating products worldwide. The company offers Liberator, a brand category of products for enhancing sexual performance; and bed therapy products, assistive in relieving medical conditions associated with acid reflux, surgery recovery, and chronic pain under the Avana brand. It also provides daybeds, sofas, and beanbags made from virgin and re-purposed polyurethane foam under the Jaxx brand; and medical isolation gowns and face masks. In addition, the company is involved in the purchase and resale of products to retailers, e-commerce sites, and single retail stores, as well as provision of contract manufacturing and fulfillment services. It markets its products through various websites comprising liberator.com, jaxxliving.com, and avanacomfort.com, as well as through distributors, retailers, and e-tailers across various channels of adult, mass market, drug, and specialty accounts. The company was formerly known as Liberator, Inc. and changed its name to Luvu Brands, Inc. in November 2015. Luvu Brands, Inc. was incorporated in 1999 and is headquartered in Atlanta, Georgia.

How the Company Makes Money

Luvu Brands generates revenue through multiple streams primarily centered around the sales of its proprietary products. The company sells its adult novelty items and wellness products through various channels, including direct-to-consumer sales via its e-commerce platforms, wholesale distribution to retailers, and partnerships with online marketplaces. Key revenue streams include product sales from its flagship brand Liberator, which features a variety of intimate products designed for comfort and pleasure, as well as sales from other lifestyle brands under its umbrella. The company's strategic partnerships with retailers and online platforms enhance its market reach and revenue potential, while ongoing product innovation and marketing efforts contribute to customer engagement and sales growth.

Luvu Brands Financial Statement Overview

Summary

Fundamentals are weak: TTM net margin is negative (~-5%) with slightly negative EBIT, and both operating and free cash flow are negative (about -$0.4M and -$0.5M). Balance-sheet risk is elevated with very high debt-to-equity (~6.1x) and low equity, reducing financial flexibility despite decent gross margin (~26%) and positive EBITDA.

Income Statement

TTM (Trailing-Twelve-Months) results show modest gross profitability (gross margin ~26%) but overall losses (net margin ~-5%) with EBIT slightly negative. Revenue is essentially flat versus the most recent annual period, but the multi-year trajectory has weakened from strong profitability in 2021–2023 to losses in 2024, 2025, and TTM—indicating margin pressure and reduced operating leverage. EBITDA remains positive in TTM, which helps, but profitability has not translated to bottom-line earnings recently.

Balance Sheet

Leverage is the central concern: TTM debt-to-equity is very high (~6.1x) with relatively low equity (~$1.5M) against ~$9.35M of debt. This is a sharp deterioration from the last annual report (~1.6x debt-to-equity), signaling increased balance-sheet risk and reduced financial flexibility. Returns to shareholders are negative in TTM due to losses, and the elevated leverage heightens sensitivity to any further earnings or cash flow volatility.

Cash Flow

TTM (Trailing-Twelve-Months) cash generation is weak: operating cash flow is negative (~-$0.4M) and free cash flow is also negative (~-$0.5M), reversing the positive cash generation seen in 2022–2024. While free cash flow is reported as more than net loss in TTM (helped by non-cash items/working capital), the business is still consuming cash, and the deterioration from prior years reduces the cushion to service higher leverage.

Breakdown	TTM	Sep 2025	Sep 2024	Jun 2023	Sep 2022	Jun 2021
Income Statement
Total Revenue	24.47M	24.69M	24.57M	29.22M	26.34M	23.11M
Gross Profit	6.43M	6.47M	6.53M	7.19M	6.00M	6.30M
EBITDA	455.00K	359.00K	586.00K	2.24M	1.55M	2.36M
Net Income	-1.33M	-448.00K	-399.00K	1.20M	604.00K	2.56M
Balance Sheet
Total Assets	11.14M	8.76M	9.13M	10.61M	10.38M	10.25M
Cash, Cash Equivalents and Short-Term Investments	1.09M	735.00K	1.03M	1.04M	859.00K	977.00K
Total Debt	9.35M	3.81M	4.17M	4.87M	5.20M	5.56M
Total Liabilities	9.60M	6.34M	6.30M	7.40M	8.43M	8.92M
Stockholders Equity	1.54M	2.42M	2.83M	3.21M	1.95M	1.32M
Cash Flow
Free Cash Flow	-494.00K	-451.00K	404.00K	546.00K	335.00K	330.00K
Operating Cash Flow	-407.00K	-410.00K	475.00K	661.00K	387.00K	540.00K
Investing Cash Flow	-87.00K	-41.00K	-71.00K	-115.00K	-52.00K	-210.00K
Financing Cash Flow	233.00K	158.00K	-417.00K	-364.00K	-453.00K	-505.00K

Luvu Brands Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.03
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LUVU, the sentiment is Negative. The current price of 0.03 is above the 20-day moving average (MA) of 0.03, below the 50-day MA of 0.03, and below the 200-day MA of 0.04, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 22.25 is Positive, neither overbought nor oversold. The STOCH value of -22.62 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LUVU.

Luvu Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLXS	71 Outperform	$291.68M	14.89	14.28%	1.77%	6.00%	64.58%
ETD	70 Outperform	$595.95M	13.62	9.21%	7.86%	-4.26%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CRWS	52 Neutral	$31.67M	-3.26	-22.07%	12.12%	-1.49%	-399.62%
NTZ	50 Neutral	$34.31M	-1.47	-39.99%	―	-4.94%	11.35%
LUVU	41 Neutral	$2.31M	-1.45	-14.98%	―	2.37%	23.81%