Purple Innovation (PRPL) AI Stock Analysis

• Market Cap: $76.54M
• Dividend Yield: N/A
• Average Volume (3M): 572.36K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.55
• Revenue Growth: -10.41%
• EPS Growth: 53.85%
• Country: US
• Employees: 1,200
• Sector: Consumer Cyclical
• Sector Strength: 56
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.11
• Shares Outstanding: 108,221,500
• 10 Day Avg. Volume: 1,074,746
• 30 Day Avg. Volume: 572,358
• PEG Ratio: -0.04
• Price to Book (P/B): 56.70
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.49
• Enterprise Value/Market Cap: 3.03
• Enterprise Value/Revenue: 0.12
• Enterprise Value/Gross Profit: 1.28
• Enterprise Value/Ebitda: -1.22
• 1Y Price Target: $1.00
• Price Target Upside: 40.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 48 Neutral
• Price Target: $0.50 ▼(-29.58%Downside)

Purple Innovation is currently facing substantial financial challenges, which are the most significant factor affecting its stock score. While strategic partnerships and improvements in showroom sales and gross margins offer some optimism, these are overshadowed by declining overall revenue, negative profit margins, and high leverage. The technical analysis reflects a neutral to slightly negative market sentiment, and the valuation indicates caution due to profitability issues.

Purple Innovation Business Overview & Revenue Model

Company Description

Purple Innovation (PRPL) is a leader in the design and manufacturing of innovative comfort solutions, primarily in the mattress and bedding industry. The company is known for its proprietary Purple Grid technology, which offers a unique combination of support and pressure relief. Purple Innovation operates within the consumer goods sector, focusing on the production and sale of mattresses, pillows, cushions, and related accessories. The company emphasizes quality and innovation in its products, aiming to provide exceptional comfort and support to its customers.

How the Company Makes Money

Purple Innovation generates revenue primarily through the sale of its comfort products, including mattresses, pillows, and cushions. The company sells its products directly to consumers via its e-commerce platform and through various retail channels, including partnerships with third-party retailers, showrooms, and wholesale partners. A significant portion of its revenue is driven by its flagship product, the Purple Mattress, which utilizes the company's proprietary Hyper-Elastic Polymer material. Purple also earns revenue from sales of bedding accessories and other comfort-related products. The company's strategic partnerships and retail presence help expand its market reach and contribute to its overall earnings.

Purple Innovation Financial Statement Overview

Summary

Purple Innovation is experiencing significant financial challenges, including declining revenue, negative profit margins, high leverage, and negative cash flow. These factors indicate inefficiencies in operations and cost management, posing substantial financial risks.

Income Statement

Purple Innovation has seen a decline in revenue over recent years, with the latest TTM revenue showing a significant drop from 2021 and 2022 levels. The gross profit margin for TTM is approximately 37.14%, which is a moderate level in the industry. However, the company is struggling with profitability, as indicated by negative net income and EBIT margins. These negative margins reflect ongoing challenges in cost management and revenue generation. The year-over-year revenue growth rate is negative, highlighting significant business challenges.

Balance Sheet

The company's balance sheet reveals high leverage, with a debt-to-equity ratio of approximately 5.08 in TTM, indicating a concerning level of debt relative to equity. The equity ratio is low at about 6.56%, pointing to a small equity buffer against liabilities. Furthermore, the return on equity is negative due to consistent net losses, suggesting challenges in generating returns for shareholders. The declining stockholders' equity over time underscores these financial pressures.

Cash Flow

Purple Innovation's cash flow statement highlights significant struggles with cash generation. The free cash flow is negative, and the free cash flow growth is also negative, indicating worsening cash generation capabilities. The operating cash flow to net income ratio is negative, reflecting difficulties in converting accounting profits into cash. Despite financing activities providing some cash inflow, the core business operations are not generating sufficient cash, posing a risk to financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	472.01M	487.88M	510.54M	573.20M	725.00M	648.47M
Gross Profit	180.46M	181.13M	171.82M	208.09M	293.75M	305.10M
EBITDA	-15.13M	-45.17M	-94.13M	141.47M	12.77M	-260.98M
Net Income	-66.82M	-97.90M	-120.76M	-92.47M	3.11M	-236.87M
Balance Sheet
Total Assets	293.77M	307.85M	390.63M	433.33M	642.47M	554.73M
Cash, Cash Equivalents and Short-Term Investments	21.63M	29.01M	26.86M	41.75M	91.62M	122.95M
Total Debt	176.92M	158.13M	152.97M	150.86M	182.32M	93.58M
Total Liabilities	292.44M	287.64M	275.02M	254.44M	495.93M	394.48M
Stockholders Equity	1.34M	20.20M	115.42M	177.96M	145.77M	159.91M
Cash Flow
Free Cash Flow	-30.65M	-25.09M	-69.90M	-66.93M	-87.96M	42.12M
Operating Cash Flow	-24.11M	-17.85M	-54.66M	-28.77M	-30.90M	81.26M
Investing Cash Flow	-6.57M	-7.53M	-16.06M	-34.50M	-57.06M	-39.14M
Financing Cash Flow	17.83M	27.53M	55.83M	13.41M	56.62M	47.36M

Purple Innovation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.71
• 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 PRPL, the sentiment is Negative. The current price of 0.71 is below the 20-day moving average (MA) of 0.76, below the 50-day MA of 0.75, and below the 200-day MA of 0.87, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 42.32 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PRPL.

Purple Innovation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	62 Neutral	$16.72B	10.85	-7.48%	3.15%	1.66%	-24.52%
LIVE	59 Neutral	$56.21M	―	-6.89%	―	5.53%	15.64%
BSET	50 Neutral	$124.12M	―	-3.83%	5.61%	-11.78%	-13.89%
FFAI	50 Neutral	$143.51M	―	-186.28%	―	8.52%	98.75%
PRPL	48 Neutral	$76.54M	―	-199.78%	―	-10.41%	53.85%
ISPO	48 Neutral	$42.55M	―	8.84%	―	-16.42%	88.30%

Purple Innovation Corporate Events

Purple Innovation Stockholders Approve Key Proposals

On June 10, 2025, Purple Innovation‘s stockholders approved several key proposals during their Annual Meeting. These included the election of nine directors, advisory approval of executive compensation, and the ratification of BDO USA, LLP as the independent accounting firm for the fiscal year ending December 31, 2025. These decisions are pivotal for the company’s governance and financial oversight, potentially impacting its strategic direction and stakeholder confidence.

The most recent analyst rating on (PRPL) stock is a Buy with a $1.50 price target. To see the full list of analyst forecasts on Purple Innovation stock, see the PRPL Stock Forecast page.

Purple Innovation Expands Credit Facility by $20 Million

On May 2, 2025, Purple Innovation entered into a Second Amendment to its credit agreement, increasing its senior secured term loan facility by $20 million, bringing the total to $100 million. This financial move aims to support Purple’s expansion and investments in innovation and advertising. Additionally, Purple announced a significant expansion of its commercial relationship with Somnigroup International, which will see Purple’s presence in Mattress Firm stores grow from 5,000 to 12,000 mattress slots. This expansion is expected to generate approximately $70 million in incremental net revenue starting in 2026. The strategic supply agreement with Tempur Sherwood, a subsidiary of Somnigroup, will allow Sherwood exclusive rights to assemble certain Purple product lines, while Purple retains its GelFlex Grid technology.

Purple Innovation Accelerates NOL Rights Plan Expiration

On June 27, 2024, Purple Innovation‘s Board of Directors adopted a stockholder rights agreement, the NOL Rights Plan, to protect $238 million in net operating losses from potential tax limitations due to ownership changes. However, on May 6, 2025, the Board decided to accelerate the plan’s expiration to May 7, 2025, to prevent artificial suppression of share price and remove barriers to new investment, following a strategic review initiated in March 2025.