Rent the Runway (RENT) AI Stock Analysis

• Market Cap: $20.83M
• Dividend Yield: N/A
• Average Volume (3M): 82.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.30
• Revenue Growth: 0.60%
• EPS Growth: 36.38%
• Country: US
• Employees: 912
• Sector: Consumer Cyclical
• Sector Strength: 64
• Industry: Apparel - Retail
• EPS (TTM): -6.15
• Shares Outstanding: 3,866,254
• 10 Day Avg. Volume: 92,903
• 30 Day Avg. Volume: 82,502
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• P/FCF Ratio: N/A
• 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: $4.50
• Price Target Upside: -17.58% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 50 Neutral
• Price Target: $5.50 ▲(0.73%Upside)

Rent the Runway's overall score is driven by substantial financial challenges, including high leverage and negative profitability. Technical analysis provides some support with short-term strength. Earnings call optimism and strategic changes offer potential for future growth, but current financial and valuation concerns weigh heavily.

Positive Factors

Revenue Performance

Rent the Runway reported 2Q24 revenue and EBITDA above the high end of guidance while reiterating guidance for breakeven free cash flow for 2024.

Subscriber Growth

Reserve and resale both grew 20%+, indicating positive trends for new subscriber growth.

Negative Factors

Market Potential

The lack of subscriber growth suggests a smaller total addressable market than initially believed at the IPO.

Rent the Runway Business Overview & Revenue Model

Company Description

Rent the Runway, Inc. rents designer wear for women through its stores and online retail. The company offers ready-to-wear, workwear, denim, casual, maternity, outerwear, blouses, knitwear, loungewear, jewelry, handbags, activewear, ski wear, home goods, evening wear, and kids wear, as well as accessories. It also engages in the software development and support activities. The company was incorporated in 2009 and is headquartered in Brooklyn, New York.

How the Company Makes Money

Rent the Runway generates revenue primarily through its subscription-based model and individual rental services. The company offers multiple subscription tiers, allowing members to rent a set number of items per month for a recurring fee. Additionally, customers can choose to rent items for a short-term period without a subscription, providing flexibility in usage. Rent the Runway also monetizes through the direct sale of pre-worn items from its inventory, catering to consumers interested in owning designer pieces at a reduced price. Strategic partnerships with designers and fashion brands enable Rent the Runway to maintain a diverse and appealing selection, further driving customer engagement and retention.

Rent the Runway Financial Statement Overview

Summary

Rent the Runway faces significant financial challenges with negative net profit and EBIT margins, negative stockholders' equity, and weak cash flow. A highly leveraged balance sheet and negative equity indicate financial instability.

Income Statement

The company shows a strong gross profit margin of 72.56% TTM, but net profit margin remains negative at -24.61% TTM, indicating profitability challenges. Revenue growth is relatively flat with a 1.48% increase over the last two years. The negative EBIT margin of -16.92% TTM reflects operational inefficiencies.

Balance Sheet

The balance sheet shows significant financial leverage with a negative stockholders' equity of -$207.1 million TTM and a high debt-to-equity ratio due to negative equity, signifying financial instability. The equity ratio is also negative, indicating potential solvency issues.

Cash Flow

The company has improved operating cash flow with a positive operating cash flow to net income ratio of 0.22 TTM. However, free cash flow remains negative, and the free cash flow to net income ratio is also negative, highlighting cash generation challenges.

Breakdown
Income Statement
Total Revenue
Gross Profit
EBITDA
Net Income
Balance Sheet
Total Assets
Cash, Cash Equivalents and Short-Term Investments
Total Debt
Total Liabilities
Stockholders Equity
Cash Flow
Free Cash Flow
Operating Cash Flow
Investing Cash Flow
Financing Cash Flow

Rent the Runway Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.46
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RENT, the sentiment is Positive. The current price of 5.46 is above the 20-day moving average (MA) of 5.13, below the 50-day MA of 5.58, and below the 200-day MA of 6.96, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 53.72 is Neutral, neither overbought nor oversold. The STOCH value of 47.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RENT.

Rent the Runway Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$17.26B	10.39	-8.50%	3.06%	1.63%	-25.95%
ZUMZ	56 Neutral	$263.54M	1,348.18	0.23%	―	3.01%	―
SFIX	56 Neutral	$687.66M	―	-27.37%	―	-8.48%	55.77%
TLYS	54 Neutral	$53.97M	―	-47.54%	―	-8.79%	-15.17%
RENT	50 Neutral	$20.83M	―	47.49%	―	0.60%	36.38%
LVLU	47 Neutral	$11.65M	―	-179.00%	―	-11.33%	-183.52%
CURV	46 Neutral	$282.64M	28.50		―	-4.21%	-16.35%

Rent the Runway Corporate Events

Rent the Runway Holds Annual Stockholders Meeting

On July 8, 2025, Rent the Runway, Inc. held its Annual Meeting of Stockholders, where 74.68% of the company’s voting power was represented. During the meeting, Tim Bixby, Jennifer Fleiss, and Daniel Rosensweig were elected as Class I Directors, and PricewaterhouseCoopers LLP was ratified as the independent registered public accounting firm for the fiscal year ending January 31, 2026.

The most recent analyst rating on (RENT) stock is a Buy with a $40.00 price target. To see the full list of analyst forecasts on Rent the Runway stock, see the RENT Stock Forecast page.

Rent the Runway Elects Daniel Rosensweig to Board

On May 12, 2025, Rent the Runway, Inc. announced the election of Daniel Rosensweig as a Class I director, increasing the Board’s size from seven to eight members. Rosensweig, who previously served on the Board from 2012 to 2023, was also appointed to the Finance Committee. His return is expected to strengthen the company’s governance and financial oversight, potentially impacting its strategic direction and stakeholder confidence.

The most recent analyst rating on (RENT) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on Rent the Runway stock, see the RENT Stock Forecast page.