QVC Group (QVCGB) AI Stock Analysis

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QVC Group

(NASDAQ:QVCGB)

48Neutral

QVC Group is currently facing significant financial challenges, with declining revenues and negative equity being the most concerning factors. While there are strategic initiatives in place and some positive technical indicators, the valuation remains unattractive due to ongoing losses. The company must address its financial instability to restore investor confidence.

QVC Group (QVCGB) vs. S&P 500 (SPY)

Market Cap

$113.87M

Dividend YieldN/A

Average Volume (3M)86.53K

Price to Earnings (P/E)―

Beta (1Y)-0.32

Revenue Growth-8.04%

EPS Growth-791.84%

CountryUS

Employees18,984

SectorConsumer Cyclical

Sector Strength55

IndustrySpecialty Retail

Share Statistics

EPS (TTM)-3.31

Shares Outstanding9,114,716

10 Day Avg. Volume51,181

30 Day Avg. Volume86,535

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.01

Price to Cash Flow (P/CF)9.90

P/FCF Ratio0.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

QVC Group Business Overview & Revenue Model

Company DescriptionQVC Group Inc. is a media and e-commerce company that owns and operates a portfolio of retail brands, including QVC, HSN, and Zulily. The company specializes in video commerce, leveraging television, digital streaming, and online platforms to engage consumers and drive sales. QVC Group Inc. focuses on interactive shopping experiences, offering a wide range of products across fashion, home, electronics, and beauty categories.

How the Company Makes MoneyQVC Group generates revenue through multiple streams, primarily focusing on direct-to-consumer sales via its television broadcast channels, online e-commerce platforms, and mobile applications. The company leverages its high-quality video content to engage viewers and drive sales, utilizing a blend of live and recorded programming. Key revenue streams include product sales, advertising, and strategic partnerships with various brands and suppliers. QVC's business model capitalizes on its ability to offer unique and exclusive products, fostering customer loyalty and repeat purchases. Additionally, the company benefits from its extensive customer data and analytics, which help tailor marketing strategies and optimize inventory management.

QVC Group Financial Statement Overview

Summary

Qurate Retail is facing significant financial challenges with declining revenue, shrinking margins, and heavy debt reliance. The income statement reveals declining profitability, while the balance sheet is burdened by high leverage. Cash flow trends show some improvement, but ongoing losses hinder stronger performance. The company's financial health indicates a need for strategic restructuring to improve profitability and reduce debt.

Income Statement

Neutral

Qurate Retail has experienced declining revenue, with a significant drop from $14.04 billion in 2021 to $10.24 billion in TTM 2024. Gross profit margin fell to 26.57% in TTM 2024 from 34.27% in 2020. The net profit margin is negative, at -2.71% in TTM 2024, indicating the company is not profitable currently. Additionally, both EBIT and EBITDA margins have decreased, with EBITDA margin at 7.13% in TTM 2024, down from 15.05% in 2020. These trends reflect decreasing profitability and growth challenges.

Balance Sheet

Neutral

Qurate Retail's balance sheet indicates financial stress, with a high debt-to-equity ratio of 14.29 in TTM 2024, showing heavy reliance on debt financing. Stockholders' equity is very low at $397 million, reflecting potential risk. The equity ratio is just 3.69%, highlighting a weak capital structure. However, total liabilities have decreased marginally from $13.22 billion in 2020 to $10.29 billion in TTM 2024, indicating some improvement in debt management.

Cash Flow

Neutral

The company has shown improvement in free cash flow, growing from negative values in 2022 to $301 million in TTM 2024. The operating cash flow to net income ratio is positive at 2.27, indicating some efficiency in converting income to cash. However, the free cash flow to net income ratio is negative due to net losses, reflecting ongoing profitability issues.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
10.24B	10.91B	12.11B	14.04B	14.18B	13.46B
	Gross Profit
2.72B	3.69B	3.69B	4.81B	4.89B	4.56B
	EBIT
708.00M	590.00M	1.10B	1.09B	1.57B	1.17B
	EBITDA
730.00M	924.00M	-1.37B	1.99B	2.13B	358.00M
	Net Income Common Stockholders
-277.00M	-145.00M	-2.53B	340.00M	1.20B	-405.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
653.00M	1.12B	1.27B	587.00M	806.00M	673.00M
	Total Assets
17.84B	11.37B	12.57B	16.25B	17.00B	17.30B
	Total Debt
7.37B	7.27B	6.87B	6.99B	6.94B	7.41B
	Net Debt
6.72B	6.13B	5.60B	6.40B	6.13B	6.74B
	Total Liabilities
12.10B	10.88B	12.05B	13.22B	13.27B	12.33B
	Stockholders Equity
5.62B	385.00M	412.00M	2.89B	3.60B	4.84B
Cash Flow		Free Cash Flow
301.00M	576.00M	-119.00M	794.00M	2.14B	825.00M
	Operating Cash Flow
630.00M	919.00M	194.00M	1.23B	2.46B	1.28B
	Investing Cash Flow
-221.00M	-54.00M	601.00M	-501.00M	-161.00M	-600.00M
	Financing Cash Flow
-646.00M	-1.01B	-72.00M	-914.00M	-2.18B	-661.00M

QVC Group Technical Analysis

Technical Analysis Sentiment

Negative

Last Price4.80

Price Trends

50DMA

5.35

Negative

100DMA

4.10

Positive

200DMA

3.96

Positive

Market Momentum

MACD

0.52

Positive

RSI

56.90

Neutral

STOCH

67.80

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QVCGB, the sentiment is Negative. The current price of 4.8 is below the 20-day moving average (MA) of 6.27, below the 50-day MA of 5.35, and above the 200-day MA of 3.96, indicating a neutral trend. The MACD of 0.52 indicates Positive momentum. The RSI at 56.90 is Neutral, neither overbought nor oversold. The STOCH value of 67.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for QVCGB.

QVC Group Risk Analysis

QVC Group disclosed 38 risk factors in its most recent earnings report. QVC Group 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

QVC Group Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DKS	78 Outperform	$15.81B	14.09	40.08%	2.37%	3.53%	13.86%
BURL	71 Outperform	$15.55B	31.24	42.55%	―	9.33%	50.05%
VVV	69 Neutral	$4.23B	15.71	186.35%	―	11.85%	―
JWN	64 Neutral	$3.97B	13.68	29.58%	3.19%	2.20%	120.00%
KSS	61 Neutral	$863.87M	7.97	2.83%	20.94%	-7.18%	-65.92%
Sector *	59 Neutral	$11.76B	10.11	-0.70%	3.92%	1.27%	-16.30%
QVCGB	48 Neutral	$113.87M	―		―	-8.04%	-791.84%

* Consumer Cyclical Sector Average

Performance Comparison

QVCGB

QVC Group

4.70

0.70

17.50%

DKS

Dick's Sporting Goods

185.93

-12.99

-6.53%

KSS

Kohl's

6.84

-13.81

-66.88%

JWN

Nordstrom

23.78

5.34

28.96%

BURL

Burlington Stores

241.05

50.94

26.80%

VVV

Valvoline

32.75

-9.00

-21.56%

QVC Group Earnings Call Summary

Earnings Call Date: Feb 27, 2025 | % Change Since: -43.53% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted successful completion of Project Athens, strong performance in QVC International, and a strategic shift towards social commerce to drive future growth. However, it also noted challenges such as revenue decline, customer count decrease, and significant impact from cord cutting. Overall, the call presents a mix of positive strategic direction and ongoing operational challenges.

Highlights

Project Athens Success

QVC Group successfully completed Project Athens, achieving more than $500 million of run rate OIBDA improvement compared to the objective of $300 million to $600 million.

QVC International Performance

QVC International was the best-performing business in Q4, with OIBDA increasing 12% year-on-year and adjusted OIBDA margin expanding by 170 basis points.

Social Commerce Strategy

QVC Group introduced a new strategy to return to growth over the next 3 years by focusing on live social shopping, with a target of generating $1.5 billion of run rate revenue from social and streaming within this period.

Debt Reduction and Financial Stability

QVC Group reduced gross debt by $442 million, extended the maturity profile, and maintained a leverage ratio of 3.1 times, below the maximum covenant threshold of 4.5 times.

Lowlights

Revenue Decline

Total revenue declined by 6% in Q4, driven by linear television declines, a cautious consumer environment, and distractions from headline events.

Customer Count Decrease

QxH customer count declined 9% in Q4, with a 7% decrease in existing and reactivated customers and a 17% decline in new customers.

Cornerstone Performance Challenges

Cornerstone's OIBDA declined by $22 million, contributing significantly to the consolidated OIBDA decrease of $28 million or 8% year-over-year.

Cord Cutting Impact

Cord cutting reduced the number of linear homes reached by QVC and HSN's main channels by 44% and 47%, respectively, since 2018.

Impairment Charge

A $1.5 billion noncash impairment charge was recognized at QxH related to goodwill and trade names.

Company Guidance

During QVC Group's 2024 Q4 earnings call, the company provided detailed guidance on several key financial metrics and strategic initiatives. Total revenue declined by 6% in Q4, attributed to linear TV declines and a cautious consumer environment. However, QVC International maintained flat revenue and expanded its adjusted OIBDA margin by 170 basis points, with OIBDA increasing 12% year-over-year. Cornerstone brands experienced a significant $22 million decline in OIBDA, contributing to three-fourths of the company's total OIBDA decrease of $28 million or 8% year-over-year. The full year saw more than $500 million of run-rate OIBDA improvement, exceeding the Project Athens goal of $300 million to $600 million, and an expansion of OIBDA margins by 220 basis points. The company also improved free cash flow by over $500 million from 2022 to 2024, excluding insurance proceeds. QVC Group reduced operating expenses by 8% and SG&A costs by 9% through lower commissions and personnel costs. Additionally, QVC International increased its adjusted OIBDA margin by 70 basis points for the year. QVC Group aims to generate $1.5 billion in run-rate revenue from social and streaming within the next three years, maintaining a stable double-digit adjusted OIBDA margin and a long-term leverage target of 2.5 times or better.

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.