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Savers Value Village Inc. (SVV)
NYSE:SVV
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Savers Value Village Inc.
(NYSE:SVV)
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Rating:61Neutral
Price Target:
$8.50
▲(3.91% Upside)
Action:ReiteratedDate:02/21/26
The score is anchored by moderately positive fundamentals (growth and improving cash flow/deleveraging) and a constructive earnings call with clear FY2026 growth and profitability targets. These are tempered by sharply weaker profitability versus prior years, mixed technical conditions, and limited/negative valuation interpretability due to a negative P/E and no dividend yield provided.
Positive Factors
U.S. sales and comps strength
Sustained U.S. demand and double-digit headline growth materially improve revenue predictability and store productivity. Strong comps drive higher transaction counts and basket size, supporting durable top-line growth, better unit economics, and a pathway to expanded adjusted EBITDA over multiple years.
New-store productivity and scale
A repeatable store roll-out with predictable maturation profiles offers scalable growth: as cohorts mature they convert from EBITDA drag to high-contribution margin outlets. This structural pipeline supports revenue expansion and margin normalization as new-store economics reach targeted contribution by year two–five.
Improving cash generation & deleveraging
Rising operating and free cash flows plus active debt paydown enhance financial flexibility. Lower interest burden from refinancing and a clear net-leverage target reduce solvency risk, fund capex/store growth, and provide a sustained platform for margin investment and shareholder returns over the medium term.
Negative Factors
Profitability compression
Material erosion in net margin signals lasting cost and operating-pressure issues: despite a recent gross-margin uptick, higher SG&A, depreciation and other expenses have limited earnings conversion. Persistent margin compression weakens resilience to demand shocks and slows cash-flow improvement.
Substantial absolute debt
Although leverage ratios have improved, large absolute debt exposes the company to interest-rate and refinancing risk and constrains capital allocation. Material interest expense (~$50M guidance) and historical high leverage amplify sensitivity to any margin or sales setbacks.
Canada weakness & cost pressures
A mature, soft Canada market limits growth optionality and forces a more conservative rollout, reducing diversification benefits. Coupled with rising merchandise and labor costs and front‑loaded preopening expenses, this structural pressure impairs margin recovery and slows company-wide profitability inflection.
Savers Value Village Inc. (SVV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.27B
Dividend YieldN/A
Average Volume (3M)1.17M
Price to Earnings (P/E)16.4
Beta (1Y)0.55
Revenue Growth6.45%
EPS Growth-102.30%
CountryUS
Employees22,700
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)0.15
Shares Outstanding155,056,720
10 Day Avg. Volume1,051,057
30 Day Avg. Volume1,166,210
Financial Highlights & Ratios
PEG Ratio-2.94
Price to Book (P/B)3.40
Price to Sales (P/S)0.88
P/FCF Ratio30.44
Enterprise Value/Market Cap1.47
Enterprise Value/Revenue1.11
Enterprise Value/Gross Profit1.52
Enterprise Value/Ebitda10.31
Forecast
1Y Price Target
$14.38Price Target Upside75.79% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)0.49
Revenue Forecast (FY)$1.78B
Savers Value Village Inc. Business Overview & Revenue Model
Company DescriptionSavers Value Village, Inc. sells second-hand merchandise in retail stores in the United States, Canada, and Australia. It operates stores under the Savers, Value Village, Village des Valeurs, Unique, and 2nd Avenue banners. The company purchases secondhand textiles, including clothing, bedding, and bath items; shoes; accessories; housewares; books; and other goods from non-profit partners, then processes, selects, prices, merchandises, and sells them in its stores. It serves retail and wholesale customers. The company was formerly known as S-Evergreen Holding LLC and changed its name to Savers Value Village, Inc. in January 2022. Savers Value Village, Inc. was founded in 1954 and is based in Bellevue, Washington.
How the Company Makes MoneySVV primarily makes money by selling secondhand merchandise in its thrift stores. Its core revenue stream is retail sales of donated and secondhand goods (e.g., apparel and home goods) to consumers at discounted prices. A key driver of its model is merchandise supply obtained through partnerships with nonprofit organizations: SVV typically pays these nonprofits for donated goods (or for the right to collect/receive donations) and, in exchange, the nonprofit receives funding and often benefits from in-store or other donation programs that can increase donation volume. SVV then sorts, prices, and merchandises the goods for sale; its gross profit is generated from the spread between retail selling prices and its costs to acquire, transport, process, and operate stores. Additional revenue can come from selling unsold or residual goods through secondary channels (e.g., recycling/wholesale of textiles or other salvage), but specific breakdowns are null.
Savers Value Village Inc. Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a constructive and improving operational and financial trajectory: a clear earnings inflection with adjusted EBITDA growth, strong U.S. demand (double-digit headline growth and high single-digit comps), successful new store rollouts and an actionable innovation agenda. Headwinds remain — notably a mature/weak Canada market, merchandise and labor cost pressure, front‑loaded preopening expenses and some seasonality/calendar noise — but management provided concrete targets, a conservative Canada plan, and balance sheet actions to de‑risk the business. On balance, the positives around profitability inflection, U.S. momentum, disciplined capital allocation and long‑term margin targets outweigh the challenges outlined.Q4-2025 Updates
Positive Updates
Inflection to Adjusted EBITDA Growth
Posted first year-over-year adjusted EBITDA growth in nearly two years, generating $74M of adjusted EBITDA in the quarter with a 15.9% adjusted EBITDA margin, marking an earnings inflection driven by maturing new stores and profit contribution gains in both countries.
Strong U.S. Sales and Comparable Store Performance
U.S. net sales increased 20.6% to $266M (12.6% excl. the 53rd week) with U.S. comparable store sales up 8.8%, driven by both transaction growth and higher average basket; management cites accelerating thrift adoption and broad-based category/region strength.
Solid Overall Revenue Growth
Total net sales increased 15.6% to $465M for the quarter (8.4% excl. the 53rd week and on a constant currency basis); overall comparable store sales were up 5.4%.
Segment Profit Expansion
U.S. segment profit rose to $60M (up $11M year-over-year) and Canada segment profit increased to $43M (up $4M), reflecting on‑plan new store maturation and improved productivity.
Store Growth and New Store Productivity
Opened 10 new stores in the quarter and 26 in 2025; planning ~25 new stores in 2026 (over 20 in the U.S.) across 11 states. Company guidance indicates typical new store economics (~$3M first-year sales ramping to ~$5M by year five; breakeven by year two, ~20% contribution margin by year five).
Loyalty and Customer Mix Shifts
Loyalty program has 6.1M active members; loyalty data shows roughly 40% of U.S. shoppers under 45 and ~45% of households with income above $100K, indicating younger and more affluent customer acquisition and improving customer mix.
Balance Sheet Strength and Capital Allocation
Ended the quarter with $86M in cash and a net leverage ratio of 2.5x; repaid $20M of debt during the quarter, reduced annual interest expense by ~$17M via refinancing, and repurchased 1.1M shares at a $8.75 weighted average price; targeting net leverage under 2x in the coming years.
Innovation and Efficiency Initiatives
Rolling out ABP Lite (asset-light automated book processing) expected to reach ~85% of fleet by end of Q2; investing in autonomous floor scrubbers, AI-enabled HVAC, and other in-store/off-site efficiency initiatives to improve gross margin and labor productivity.
2026 Financial Outlook
Provided FY2026 guidance: net sales $1.76B–$1.79B; comparable store sales +2.5%–4%; adjusted EBITDA $260M–$275M; adjusted net income $73M–$85M; capex $125M–$145M; ~25 new stores. Management expects adjusted EBITDA growth in 2026 with roughly flat adjusted EBITDA margin.
Negative Updates
Soft and Mature Canadian Market
Canada comparable store sales were only +0.7% in the quarter with net sales up modestly; management is taking a conservative plan for Canada (flat to low single-digit comps expected) and will significantly decelerate new store openings there, reflecting a mature and weaker near-term macro environment.
Rising Cost of Merchandise and Labor Pressure
Cost of merchandise sold increased 30 basis points to 44.6% of net sales (attributed in part to new stores); salaries, wages and benefits were $93M and increased 90 basis points as a percent of sales to 19.2%, driven by new store growth, incentive expense and higher wage rates.
Front-Loaded Preopening and Seasonal Headwinds
Expect preopening expenses to be ~$14M–$16M in 2026 (consistent with 2025) and more front‑loaded due to a more balanced annual opening cadence; 2026 will also lap a 53-week fiscal year creating an ~2% headwind to total sales growth and Q1 faces holiday timing (earlier Easter) and related store closure effects.
Higher Depreciation and Store Closure Charges
Depreciation and amortization increased 32% to $22M, reflecting investments in new stores, the extra week impact and accelerated depreciation on seven stores closed during the quarter.
Weather and Operational Disruptions
Severe weather (late January storms) disrupted U.S. operations and similarly affected Canada in January, creating short-term volatility in comps and operational cadence.
New Stores Unprofitable Initially
New stores are typically unprofitable in year one (first‑year sales ~ $3M), creating near-term EBITDA drag historically; although management says this trend has turned modestly positive in 2026 as stores mature, initial-year losses remain a factor.
Company Guidance
Management guided fiscal 2026 net sales of $1.76–$1.79 billion, comparable store sales growth of 2.5%–4% (assuming mid‑single‑digit U.S. comps and flat to low‑single‑digit Canada comps and lapping a 53rd week that is ~2% headwind to total sales), net income of $66–$78 million ($0.41–$0.48 per diluted share), adjusted net income of $73–$85 million ($0.45–$0.53), adjusted EBITDA of $260–$275 million, capital expenditures of $125–$145 million, roughly 25 new store openings (20+ in the U.S.), preopening expenses of ~$14–$16 million (more front‑loaded), ~$8 million of IPO‑related stock‑based compensation (split evenly between Q1 and Q2), net interest expense of about $50 million, an effective tax rate near 28% (27% on adjusted), weighted average diluted shares of ~163 million, Q1 revenue growth expected mid‑ to high‑single digits with adjusted EBITDA roughly flat to slightly up, and management expects adjusted EBITDA growth for the year with roughly flat margins while progressing toward a long‑term target of high‑teens adjusted EBITDA margins and net leverage under 2x within a couple years.Savers Value Village Inc. Financial Statement Overview
Summary
Steady multi-year revenue growth and improving operating/free cash flow are positives, alongside a recent reduction in leverage. Offsetting factors are meaningful profitability compression (net margin down sharply since 2021–2022) and uneven cash conversion (operating cash flow and free cash flow low relative to net income), which reduces resilience.Income Statement
Revenue has grown steadily since 2020, with the latest annual period showing strong growth (up 3.878). Profitability, however, has compressed meaningfully: net margin declined from 6.9% (2021) to 5.9% (2022) to 3.5% (2023) to 1.9% (2024) and 1.3% (latest). EBITDA margin also trended down versus 2021–2022 levels, indicating higher operating cost pressure. A major positive is the sharp improvement in gross margin in the latest period (79.2% vs ~56% prior years), but the weak net margin suggests those gains are not fully flowing through to the bottom line.64
Positive
Balance Sheet
Leverage remains the key balance sheet constraint. While debt-to-equity improved materially in the latest period (1.55x) versus 2022–2024 (roughly 3.1x–5.6x), absolute debt is still sizable ($673M) relative to equity ($436M). Total assets have risen versus 2020, supporting scale, but the company’s historical pattern of high leverage and declining profitability increases sensitivity to any demand or margin shock. Return on equity has also cooled significantly from very strong levels in 2021–2022 to much lower levels in 2023–2024, consistent with reduced earnings power.58
Neutral
Cash Flow
Cash generation is positive and improving recently: operating cash flow increased to $167M in the latest period (from $134M in 2024), and free cash flow rose to $48.6M with very strong growth (up 90.6). That said, cash flow quality is mixed: operating cash flow relative to net income is below 1.0 across periods provided (about 0.58–0.73 recently), and free cash flow is only a modest portion of net income (about 0.21–0.47 historically and ~0.29 in the latest period), implying working-capital needs and/or reinvestment are limiting cash conversion.61
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.68B | 1.54B | 1.50B | 1.44B | 1.20B |
| Gross Profit | 1.33B | 867.87M | 846.00M | 837.30M | 729.66M |
| EBITDA | 184.99M | 186.77M | 203.00M | 244.79M | 174.16M |
| Net Income | 22.64M | 29.03M | 53.12M | 84.72M | 83.39M |
Balance Sheet | |||||
| Total Assets | 2.01B | 1.89B | 1.87B | 1.86B | 1.22B |
| Cash, Cash Equivalents and Short-Term Investments | 85.90M | 149.97M | 179.96M | 112.13M | 97.92M |
| Total Debt | 673.05M | 1.30B | 1.29B | 1.26B | 803.94M |
| Total Liabilities | 1.58B | 1.46B | 1.49B | 1.63B | 1.04B |
| Stockholders Equity | 435.58M | 421.68M | 376.06M | 227.34M | 185.43M |
Cash Flow | |||||
| Free Cash Flow | 48.64M | 28.40M | 82.77M | 59.26M | 135.22M |
| Operating Cash Flow | 167.28M | 134.28M | 175.16M | 169.43M | 175.76M |
| Investing Cash Flow | -118.47M | -80.52M | -92.36M | -110.50M | -263.17M |
| Financing Cash Flow | -116.02M | -76.63M | -17.04M | -40.22M | 53.00M |
Savers Value Village Inc. Technical Analysis
Negative
8.18
Price Trends
9.91
Negative
9.66
Negative
10.58
Negative
Market Momentum
-0.63
Positive
29.42
Positive
19.73
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SVV, the sentiment is Negative. The current price of 8.18 is below the 20-day moving average (MA) of 8.86, below the 50-day MA of 9.91, and below the 200-day MA of 10.58, indicating a bearish trend. The MACD of -0.63 indicates Positive momentum. The RSI at 29.42 is Positive, neither overbought nor oversold. The STOCH value of 19.73 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SVV.
Savers Value Village Inc. Risk Analysis
Savers Value Village Inc. disclosed 41 risk factors in its most recent earnings report. Savers Value Village Inc. 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
Savers Value Village Inc. Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.44B | 34.96 | ― | 3.35% | 3.35% | 1.97% | |
67 Neutral | $1.63B | 29.01 | 12.82% | ― | 9.24% | 35.68% | |
64 Neutral | $1.36B | 7.65 | 23.43% | ― | -0.42% | 31.64% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $1.27B | 16.40 | 5.37% | ― | 6.45% | -102.30% | |
53 Neutral | $425.57M | -38.47 | -34.47% | ― | -4.90% | 50.77% | |
50 Neutral | $874.40M | -12.43 | -133.66% | ― | -4.62% | ― |
* Consumer Cyclical Sector Average
SVV
Savers Value Village Inc.
8.18
1.11
15.70%
SBH
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14.01
5.51
64.82%
WINA
Winmark
404.31
92.19
29.54%
JMIA
Jumia Technologies AG
7.06
4.63
190.53%
RVLV
Revolve Group
22.86
0.92
4.19%
TDUP
thredUP
3.35
0.91
37.30%
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.