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Stitch Fix (SFIX)
NASDAQ:SFIX
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Stitch Fix
(NASDAQ:SFIX)
Rating:55Neutral
Price Target:
$5.00
▼(-8.59% Downside)
Positive Factors
Guidance and Financial Outlook
Guidance for Q3 revenues is projected to be in the $311M-$316M range, which is higher than the current Street estimate of $279M.
Profitability
Profitability is more of a bright spot at present, where presumably some level of growth would better leverage the model and present upside.
Revenue Growth
Stitch Fix achieved 0.7% year-over-year revenue growth in its fiscal third quarter, a year ahead of schedule.
Negative Factors
Active Clients
Active clients declined by 15.5% year-over-year to 2.371 million.
Conservatism in Outlook
There is uncertainty about how much conservatism is included in the outlook, particularly regarding the active customer step-back management is guiding to in the fiscal fourth quarter.
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
$682.44M
Dividend YieldN/A
Average Volume (3M)2.02M
Price to Earnings (P/E)―
Beta (1Y)2.05
Revenue Growth-8.48%
EPS Growth55.77%
CountryUS
Employees4,570
SectorConsumer Cyclical
Sector Strength80
IndustryApparel - Retail
Share Statistics
EPS (TTM)-0.06
Shares Outstanding114,225,430
10 Day Avg. Volume1,899,660
30 Day Avg. Volume2,016,268
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 Cap0.44
Enterprise Value/Revenue0.23
Enterprise Value/Gross Profit0.52
Enterprise Value/Ebitda-7.14
Forecast
1Y Price Target
$4.67Price Target Upside-14.63% Downside
Rating ConsensusHold
Number of Analyst Covering5
Stitch Fix Business Overview & Revenue Model
Company DescriptionStitch Fix (SFIX) is an online personal styling service that operates in the retail and e-commerce sector, specializing in curated clothing and accessory offerings for men, women, and children. Customers receive personalized selections of apparel based on their individual preferences, sizes, and style profiles, which are delivered directly to their homes. The company's unique model combines data analytics with human stylists to create a tailored shopping experience, allowing clients to discover items they might not have selected on their own.
How the Company Makes MoneyStitch Fix generates revenue primarily through its direct-to-consumer sales model. Customers pay a styling fee for each shipment, which is applied as a credit toward any items they choose to purchase. Additionally, the company earns revenue from the sale of clothing and accessories, which are priced competitively within the market. Key revenue streams include the styling fees, the markup on purchased items, and subscription-based services that encourage customer retention. Significant partnerships with various clothing brands enable Stitch Fix to offer a diverse range of products. The company's use of data analytics to refine its inventory and customer recommendations also plays a crucial role in enhancing sales and improving customer satisfaction.
Stitch Fix Earnings Call Summary
Earnings Call Date:Jun 10, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Sep 23, 2025
Earnings Call Sentiment Positive
The earnings call reflected a positive sentiment due to the company's return to revenue growth and improved client metrics, despite challenges such as a decline in active clients and macroeconomic pressures. The company's strategic initiatives and strong performance in key segments outweighed the lowlights.Q3-2025 Updates
Positive Updates
Return to Revenue Growth
Q3 revenue was $325 million, marking a return to year-over-year revenue growth. Adjusted EBITDA was $11 million.
Strong Performance in Women's and Men's Segments
Both the 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.
Increase in Average Order Value (AOV)
AOV grew 10% year-over-year, marking the seventh consecutive quarter of AOV growth. This was driven by larger fixes and improved client engagement.
Growth in New Clients and Retention
New clients grew for the second consecutive quarter, with 90-day lifetime value (LTV) at its highest in three years. Active clients on recurring shipments have grown for three straight quarters.
Successful Transformation Strategy
The company has successfully rationalized and built a firm foundation, incorporating retail best practices and improving client experience with new features.
Negative Updates
Decline in Active Clients
Net active clients ended the quarter at 2.4 million, down 10.6% year-over-year and 0.8% quarter-over-quarter.
Macroeconomic and Tariff Challenges
Significant external challenges include a dynamic macroeconomic environment, shifting tariff landscape, and ongoing pressure on consumer discretionary spending.
Gross Margin Decline
Gross margin for the quarter was 44.2%, down 130 basis points year-over-year and 30 basis points quarter-over-quarter due to lower product margins.
Company Guidance
In the Stitch Fix Q3 FY '25 earnings call, the company reported a return to year-over-year revenue growth, with Q3 revenue reaching $325 million and adjusted EBITDA at $11 million. The Women's business and Fix channel saw a return to revenue growth, while both the Men's business and Freestyle channel experienced growth for the second consecutive quarter. Average Order Value (AOV) increased by 10%, supported by higher items per Fix, keep rate, and Average Unit Retail (AUR) for the second straight quarter. Net active clients totaled 2.4 million, with revenue per active client at $542, translating to a 3.2% increase year-over-year. Gross margin for the quarter was at 44.2%, and advertising accounted for 10.2% of revenue. For the fiscal year, Stitch Fix has updated its guidance, projecting full-year revenue between $1.254 billion and $1.259 billion and adjusted EBITDA in the range of $43 million to $47 million. Looking ahead, the company anticipates Q4 revenue between $298 million and $303 million, with adjusted EBITDA expected to be between $3 million and $7 million.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
Positive
5.47
Price Trends
4.49
Positive
4.12
Positive
4.26
Positive
Market Momentum
0.16
Negative
61.28
Neutral
71.17
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SFIX, the sentiment is Positive. The current price of 5.47 is above the 20-day moving average (MA) of 4.86, above the 50-day MA of 4.49, and above the 200-day MA of 4.26, indicating a bullish trend. The MACD of 0.16 indicates Negative momentum. The RSI at 61.28 is Neutral, neither overbought nor oversold. The STOCH value of 71.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
70 Neutral | $253.39M | 7.45 | 41.77% | 1.76% | -2.24% | -33.43% | |
61 Neutral | $17.75B | 12.56 | -5.49% | 3.02% | 1.43% | -14.12% | |
55 Neutral | $682.44M | ― | -27.37% | ― | -8.48% | 55.77% | |
50 Neutral | $229.06M | 23.09 | ― | -4.21% | -16.35% | ||
48 Neutral | $22.25M | ― | 47.49% | ― | 0.60% | 36.38% | |
47 Neutral | $54.57M | ― | -47.54% | ― | -8.79% | -15.17% | |
44 Neutral | $97.76M | ― | -521.67% | ― | -12.15% | 75.86% |
* Consumer Cyclical Sector Average
Performance Comparison
SFIX
Stitch Fix
5.47
1.67
43.95%
PLCE
Children's Place
4.63
-1.20
-20.58%
TLYS
Tilly's
1.87
-3.62
-65.94%
JILL
JJill
17.09
-15.59
-47.71%
CURV
Torrid Holdings
2.21
-4.45
-66.82%
RENT
Rent the Runway
5.62
-6.60
-54.01%
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.