Kits Eyecare (KITS) AI Stock Analysis

• Market Cap: C$545.67M
• Dividend Yield: N/A
• Average Volume (3M): 39.29K
• Price to Earnings (P/E): 142.2
• Beta (1Y): 0.70
• Revenue Growth: 35.02%
• EPS Growth: 1471.05%
• Country: CA
• Employees: 162
• Sector: Consumer Cyclical
• Sector Strength: 83
• Industry: Specialty Retail
• EPS (TTM): -0.02
• Shares Outstanding: 32,136,215
• 10 Day Avg. Volume: 27,026
• 30 Day Avg. Volume: 39,290
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• 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: C$21.50
• Price Target Upside: 26.62% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 64 Neutral
• Price Target: C$17.50 ▲(3.06% Upside)

Kits Eyecare's strong financial performance, characterized by robust revenue growth and improved profitability, is the most significant factor driving the stock score. The technical analysis supports a positive trend, although caution is advised due to the high stochastic indicator. The valuation is a concern, with a high P/E ratio suggesting potential overvaluation. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Customer Retention

Returning customers comprised 61% of revenue, and the average order value grew to $184, showing strong customer retention and increased spending.

Growth Potential

KITS has the potential to double its capacity to $500M in revenue with existing infrastructure and minimal capital expenditure.

Market Opportunity

The e-commerce segment of the global eyewear market is set to double by 2034, indicating a massive market shift and opportunity for digital growth.

Negative Factors

Earnings Expectation

Shares are trading at all-time high levels due to a re-rate driven by EBITDA margin acceleration, making the risk-reward profile attractive.

Guidance Expectations

The Q2 EBITDA margin guidance is below street expectations due to planned marketing investments.

Market Penetration

Despite rapid growth, only 14% of prescription eyeglasses are currently purchased online, signaling a largely untapped market.

Kits Eyecare Business Overview & Revenue Model

Company Description

Kits Eyecare (KITS) is an innovative eyecare company that specializes in providing a comprehensive range of optical products and services. The company operates in the healthcare sector, focusing on the design, manufacturing, and distribution of eyewear products including eyeglasses, contact lenses, and related accessories. KITS is committed to enhancing vision care by offering high-quality, affordable products and exceptional customer service through its online platform.

How the Company Makes Money

Kits Eyecare generates revenue primarily through the sale of its eyewear products, including prescription eyeglasses, sunglasses, and contact lenses, directly to consumers via its e-commerce platform. The company capitalizes on the growing demand for online shopping by providing a convenient, user-friendly experience that allows customers to easily select and purchase optical products. Additionally, KITS may engage in strategic partnerships with eyewear brands and suppliers to broaden its product range and optimize its supply chain, thus contributing to its earnings. The company's revenue model is further supported by its focus on customer loyalty and retention through regular promotions and subscription services for contact lenses.

Kits Eyecare Financial Statement Overview

Summary

Kits Eyecare demonstrates strong financial health with impressive revenue growth and profitability improvements. The balance sheet shows low leverage and a solid equity position, while cash flow metrics confirm efficient cash management. However, there is room for improvement in operational efficiency and asset growth.

Income Statement

Kits Eyecare showed strong revenue growth over the past years, with a notable increase from $91.6M in 2022 to $171.2M TTM. The gross profit margin improved significantly, reaching 34.8% TTM, indicative of efficient cost management. Net profit margin improved to 2.7% TTM, demonstrating profitability turnaround. However, EBIT and EBITDA margins, though improving, remain modest, suggesting room for enhancing operational efficiency.

Balance Sheet

The company's balance sheet is stable, with a debt-to-equity ratio of 0.16 TTM, indicating low leverage. The equity ratio stands at 60.2% TTM, reflecting a solid capital structure. Return on equity improved to 7.6% TTM, showing effective use of equity capital. However, the total assets have been relatively stable, suggesting limited asset growth.

Cash Flow

Cash flow performance is robust, with a positive free cash flow of $6.3M TTM, indicating effective cash generation. Operating cash flow to net income ratio is 2.0 TTM, showing strong cash conversion. Free cash flow to net income ratio of 1.34 TTM further confirms efficient cash flow management. However, fluctuations in investing and financing cash flows suggest potential volatility in cash reserves.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	182.88M	159.34M	120.51M	91.64M	82.40M	75.22M
Gross Profit	65.18M	53.65M	40.79M	29.25M	20.89M	21.39M
EBITDA	9.37M	8.31M	1.86M	-721.00K	-14.68M	-1.80M
Net Income	3.77M	3.12M	-2.21M	-4.55M	-14.62M	-6.58M
Balance Sheet
Total Assets	94.26M	103.02M	87.64M	93.86M	90.94M	54.66M
Cash, Cash Equivalents and Short-Term Investments	18.11M	19.27M	16.04M	18.79M	20.50M	2.31M
Total Debt	7.72M	12.60M	15.39M	19.44M	22.94M	22.33M
Total Liabilities	35.09M	45.13M	36.20M	40.16M	36.16M	55.23M
Stockholders Equity	59.17M	57.89M	51.45M	53.71M	54.78M	-573.00K
Cash Flow
Free Cash Flow	5.48M	9.88M	1.84M	4.42M	-23.09M	3.96M
Operating Cash Flow	8.10M	13.04M	2.40M	4.68M	-19.46M	4.18M
Investing Cash Flow	-2.61M	-3.15M	-563.00K	-258.00K	-3.63M	-225.00K
Financing Cash Flow	-6.62M	-5.02M	-5.07M	-5.13M	41.48M	-4.84M

Kits Eyecare Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:KITS, the sentiment is Positive. The current price of 16.98 is above the 20-day moving average (MA) of 16.51, above the 50-day MA of 16.23, and above the 200-day MA of 11.82, indicating a bullish trend. The MACD of 0.17 indicates Positive momentum. The RSI at 58.05 is Neutral, neither overbought nor oversold. The STOCH value of 40.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:KITS.

Kits Eyecare Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KITS	64 Neutral	C$545.67M	142.21	6.70%	―	35.02%	1471.05%
Sector *	61 Neutral	$17.92B	12.81	-3.11%	2.97%	1.30%	-14.28%
FTI	―	C$4.19M	―		―	―	―
LNF	75 Outperform	C$2.06B	12.81	14.38%	2.66%	0.57%	8.54%
GBT	61 Neutral	C$407.32M	13.99	5.95%	2.82%	5.97%	174.18%
NEXCF	―	$16.76M	―		―	―	―
ECOM	54 Neutral	C$13.45M	―	204.61%	―	8.53%	98.44%

Kits Eyecare Corporate Events

Kits Eyecare Achieves Record Revenue and Sustained Growth in Q2 2025

Kits Eyecare Ltd. reported a record revenue of $49.6 million for the second quarter of 2025, marking a 31% year-over-year increase. The company also achieved its eleventh consecutive quarter of positive adjusted EBITDA, which improved to $2.6 million. This growth was driven by strong new customer acquisition and a significant increase in glasses revenue. Despite a net loss due to non-operating exchange losses, the company showed a robust operational performance with a 45.1% increase in gross profit, reflecting successful pricing and promotional strategies. Kits Eyecare is well-positioned for continued growth, with expectations of further revenue increases in the third quarter.

The most recent analyst rating on (TSE:KITS) stock is a Buy with a C$14.00 price target. To see the full list of analyst forecasts on Kits Eyecare stock, see the TSE:KITS Stock Forecast page.

Kits Eyecare Reports 2025 AGM Voting Results

Kits Eyecare Ltd. announced the results of its 2025 Annual General Meeting, where all proposed resolutions were passed, including the election of six directors and the re-appointment of MNP LLP as auditors. The voting results reflect strong shareholder support, positioning the company to continue its focus on innovation and customer satisfaction in the digital eyecare industry.

The most recent analyst rating on (TSE:KITS) stock is a Buy with a C$11.25 price target. To see the full list of analyst forecasts on Kits Eyecare stock, see the TSE:KITS Stock Forecast page.

Kits Eyecare Achieves Record First Quarter Results with 34% Revenue Growth

Kits Eyecare Ltd. reported a record-breaking first quarter in 2025, with a 34% increase in revenue year-over-year, reaching $46.6 million. The company’s adjusted EBITDA also improved significantly to $3.5 million, marking its tenth consecutive quarter of positive adjusted EBITDA. The growth was driven by increased sales of glasses, with 104,000 pairs delivered, and a focus on acquiring high-value customers. This financial performance underscores the strength of Kits’ vertically integrated model and its strategic focus on operational efficiency, positioning the company for sustained profitable growth.