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Stitch Fix (SFIX)
:SFIX
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Stitch Fix
(NASDAQ:SFIX)
Rating:57Neutral
Price Target:
$5.00
▲(8.23% Upside)
Positive Factors
Business Strategy
Management has improved product and experience, and is now investing ad dollars behind momentum while keeping returns healthy.
Guidance and Outlook
Guidance for Q3 revenues is projected to be in the $311M-$316M range, which is higher than the current Street estimate of $279M.
Revenue Growth
Stitch Fix achieved 0.7% year-over-year revenue growth in its fiscal third quarter, a year ahead of schedule.
Negative Factors
Customer Base
The overall active client base declined (15.5%) year-over-year to 2.4M, essentially in line with estimates.
Future Uncertainty
Management is expressing caution into the next fiscal year, which could keep market exuberance tempered.
Market Perception
The largest headwind for Stitch Fix shares is a mindset that the real market for Stitch Fix’s offering is small, limiting upside even after it returns to some semblance of growth.
Stitch Fix (SFIX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$585.88M
Dividend YieldN/A
Average Volume (3M)2.10M
Price to Earnings (P/E)―
Beta (1Y)2.11
Revenue Growth-8.48%
EPS Growth55.77%
CountryUS
Employees4,570
SectorConsumer Cyclical
Sector Strength60
IndustryApparel - Retail
Share Statistics
EPS (TTM)-0.06
Shares Outstanding114,225,430
10 Day Avg. Volume2,514,611
30 Day Avg. Volume2,101,560
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.51
Enterprise Value/Revenue0.23
Enterprise Value/Gross Profit0.52
Enterprise Value/Ebitda-7.14
Forecast
1Y Price Target
$4.75Price Target Upside2.81% Upside
Rating ConsensusHold
Number of Analyst Covering6
Stitch Fix Business Overview & Revenue Model
Company DescriptionStitch Fix, Inc. (SFIX) is an online personal styling service that leverages data analytics and the expertise of personal stylists to deliver personalized clothing and accessory recommendations to its customers. Operating primarily in the e-commerce and fashion sectors, Stitch Fix offers a unique shopping experience by curating assortments of clothing items for men, women, and children, which are then shipped directly to the customer's door.
How the Company Makes MoneyStitch Fix makes money through a combination of styling fees, product sales, and subscription services. The primary revenue stream comes from the sale of clothing and accessories. Customers pay a styling fee for each 'Fix' that they order, which is credited towards any purchases they make from that shipment. Items that are not purchased are returned to the company. Additionally, Stitch Fix offers a subscription service called 'Style Pass,' where customers pay an annual fee for unlimited styling throughout the year. The company's use of data science to analyze customer preferences and optimize inventory also plays a crucial role in maintaining efficient operations and maximizing sales. Partnerships with various clothing brands and manufacturers help widen their product offerings and enhance customer satisfaction.
Stitch Fix Earnings Call Summary
Earnings Call Date:Jun 10, 2025
(Q3-2025)
| % Change Since: -3.55%|
Next Earnings Date:Sep 23, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a cautious optimism with a return to revenue growth and improvements in key client metrics. However, challenges such as a decline in active clients, gross margin pressures, and potential tariff impacts were noted.Q3-2025 Updates
Positive Updates
Return to Year-over-Year Revenue Growth
Q3 revenue reached $325 million, marking a return to year-over-year growth with a 0.7% increase. Adjusted EBITDA was $11 million.
Growth in Women's and Men's Business Segments
Women's business and overall Fix channel returned to revenue growth. Men's business and Freestyle channel revenue also grew for the second consecutive quarter.
Improvement in Average Order Value
AOV grew 10% year-over-year, marking the seventh consecutive quarter of AOV growth, driven by larger fixes and improved assortment strategy.
Increased Client Engagement and New Client Growth
For the second consecutive quarter, there was year-over-year new client growth, and the number of active clients on recurring shipments increased for three straight quarters.
Strong Performance in Athleisure and Footwear
Athleisure was up over 30% year-over-year, and sneakers saw a 35% increase, contributing to higher Fix AOVs and growth in Freestyle channel.
Negative Updates
Decline in Active Clients
Net active clients ended the quarter at 2.4 million, down 10.6% year-over-year and down 0.8% quarter-over-quarter.
Challenges with Gross Margin
Gross margin for Q3 was 44.2%, down 130 basis points year-over-year, influenced by lower product margins and mix shift.
Potential Tariff Impact on Future Costs
Current tariff rates could increase costs in FY '26, posing a potential challenge if not mitigated through strategic sourcing and supplier negotiations.
Company Guidance
During the Q3 FY '25 earnings call, Stitch Fix reported a return to year-over-year revenue growth, achieving $325 million in revenue and $11 million in adjusted EBITDA. The company highlighted a 10% increase in Average Order Value (AOV), marking the seventh consecutive quarter of AOV growth, with items per Fix, keep rate, and Average Unit Retail (AUR) all increasing for the second straight quarter. Net active clients ended at 2.4 million, down 10.6% year-over-year, but revenue per active client rose to $542, up 3.2% year-over-year. Gross margin was 44.2%, and advertising expenses accounted for 10.2% of revenue. The company expects Q4 revenue between $298 million and $303 million and adjusted EBITDA between $3 million and $7 million, with full-year FY '25 revenue projected between $1.254 billion and $1.259 billion.Stitch Fix Financial Statement Overview
Summary
Stitch Fix is facing declining revenues and profitability issues despite maintaining manageable leverage and some cash flow resilience. Operational inefficiencies and asset reductions are significant risks, and improving operational efficiency and revenue growth is crucial.Income Statement
Stitch Fix has faced a consistent decline in revenue growth, with the latest TTM showing a decrease in total revenue. The gross profit margin for TTM is 44.65%, which is somewhat stable. However, the net profit margin remains negative at -4.44%, indicating ongoing challenges in profitability. EBIT and EBITDA margins are also negative, reflecting operational inefficiencies.45
Neutral
Balance Sheet
The company maintains a moderate debt-to-equity ratio, indicating manageable leverage with a slight improvement in stockholders' equity. The equity ratio stands at 41.34% for TTM, suggesting a decent level of financial stability. However, the overall decline in total assets over the years could be a concern for future financial health.50
Neutral
Cash Flow
Free cash flow has seen fluctuations but remains positive in the TTM period, showing some resilience. The operating cash flow to net income ratio is positive, suggesting that the company is generating cash flow despite net losses. However, the free cash flow to net income ratio also indicates that cash flow is not robust enough to cover net income losses entirely.55
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.34B | 1.59B | 2.02B | 2.10B | 1.71B |
| Gross Profit | 592.04M | 675.61M | 886.67M | 947.64M | 754.21M |
| EBITDA | -88.94M | -113.16M | -148.76M | -33.43M | -29.05M |
| Net Income | -128.84M | -171.97M | -207.12M | -8.88M | -67.12M |
Balance Sheet | |||||
| Total Assets | 486.86M | 614.48M | 764.53M | 819.15M | 769.43M |
| Cash, Cash Equivalents and Short-Term Investments | 246.97M | 257.60M | 212.98M | 231.33M | 286.49M |
| Total Debt | 117.50M | 154.76M | 170.35M | 147.32M | 164.51M |
| Total Liabilities | 299.84M | 367.17M | 441.88M | 358.30M | 368.39M |
| Stockholders Equity | 187.02M | 247.31M | 322.65M | 460.85M | 401.04M |
Cash Flow | |||||
| Free Cash Flow | 14.24M | 38.82M | 9.04M | -50.93M | 12.67M |
| Operating Cash Flow | 28.21M | 57.83M | 55.40M | -15.68M | 42.88M |
| Investing Cash Flow | -78.74M | 64.33M | 10.23M | 39.09M | -70.46M |
| Financing Cash Flow | -15.49M | -15.54M | -60.25M | -38.88M | -1.44M |
Stitch Fix Technical Analysis
Neutral
4.62
Price Trends
4.36
Positive
3.91
Positive
4.12
Positive
Market Momentum
0.17
Positive
51.44
Neutral
21.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SFIX, the sentiment is Neutral. The current price of 4.62 is below the 20-day moving average (MA) of 4.65, above the 50-day MA of 4.36, and above the 200-day MA of 4.12, indicating a neutral trend. The MACD of 0.17 indicates Positive momentum. The RSI at 51.44 is Neutral, neither overbought nor oversold. The STOCH value of 21.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SFIX.
Stitch Fix Risk Analysis
Stitch Fix disclosed 45 risk factors in its most recent earnings report. Stitch Fix 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
Stitch Fix Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $240.56M | 7.07 | 41.77% | 1.95% | -2.24% | -33.43% | |
61 Neutral | $16.48B | 10.03 | -9.00% | 3.34% | 1.42% | -22.40% | |
57 Neutral | $585.88M | ― | -27.37% | ― | -8.48% | 55.77% | |
47 Neutral | $50.05M | ― | -47.54% | ― | -8.79% | -15.17% | |
46 Neutral | $262.68M | 26.48 | ― | -4.21% | -16.35% | ||
44 Neutral | $104.19M | ― | -521.67% | ― | -12.15% | 75.86% | |
40 Underperform | $17.25M | ― | 47.49% | ― | 0.60% | 36.38% |
* Consumer Cyclical Sector Average
Performance Comparison
SFIX
Stitch Fix
4.62
1.08
30.51%
PLCE
Children's Place
4.70
-2.70
-36.49%
TLYS
Tilly's
1.68
-2.97
-63.87%
JILL
JJill
15.86
-18.70
-54.11%
CURV
Torrid Holdings
2.33
-5.41
-69.90%
RENT
Rent the Runway
4.29
-6.31
-59.53%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.