Stitch Fix Inc. (SFIX): Why You Should Keep An Eye On It

The stock of Stitch Fix Inc. (NASDAQ:SFIX) decreased by decreased by -$0.34 on Friday to finish at $34.52, down -0.98 percent. The last five days have seen an average of 1,611,360 shares of common stock traded. 11 times new highs were reached in the current year, with a fall of -$24.20. The average number of shares traded over the last 20 days was 2,153,535, while the average volume over the last 50 days totaled 2,607,780.

SFIX stock dropped -16.38% since last month. On 10/18/21, the company’s shares reached a one-month low of $31.50. The stock touched a high of $113.76 on 01/27/21, after rallying from a low of $31.50 in 52 weeks. The price of SFIX stock has declined by -41.21% or -$24.20 this year, reaching a new high 11 times. Still, the stock price is down -69.66% from the 52-week high.

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Insider Transactions

There have been 5 days since Stitch Fix Inc. (SFIX) last reported insider trading activity on Oct 20. On Oct 20, Director Lake Katrina sold 33,360 shares at $33.31 each. This transaction resulted in the insider making $1,111,382. On Oct 19, Lake Katrina sold 33,359 shares at a price of US$32.95. After the transaction, the insider now owns 0 shares. Director Lake Katrina had earlier sold 33,358 shares on Oct 18 for $32.36 a share. The transaction was completed for $1,079,435.

Valuation Metrics

The PE ratio of Stitch Fix Inc. has varied between 309.93 and 42.87 in the last five years. Beta for the stock is 1.85. There are also a few other valuation ratios worth considering, including the trailing price-to-sales (P/S) ratio of 1.80, the price-to-book (PB) ratio of 8.05.

For the three months ended April 29, Stitch Fix Inc.’s quick ratio was 1.40, while its current ratio was 2.30, indicating its ability to pay off its debt. As far as profitability goes, gross margin for the trailing twelve months is 45.10% percent. Stitch Fix Inc.’s EBITDA margin for the year ended April 29 was -1.63%, whereas its operating margin stood at -3.00% for the same period. Based on annual data, it had gross profit of $947.64 million and revenue of $2.1 billion.

Investors will also look at the performance of the company’s management in order to determine the potential profitability of their investment. SFIX’s return on assets (ROA) during the last 12 months has been -1.00%. There was a -5.40% return on investment (ROI) in the past year. In the meantime, the return on equity (ROE) for the last 12 months was -2.00%. ROE has averaged 10.33 in the past year for the broader industry.

Earnings Surprise

According to Stitch Fix Inc.’s quarterly financial report for the quarter that ended April 29, it had $101.55 million in cash and short-term investments. A higher net income was reported in the quarter under review than the previous quarter. Net income for the quarter came in at $571.16 million, while revenues rose by 22.37% to $535.59 million. It was predicted that Stitch Fix Inc.’s quarterly earnings would be -$0.18, but it ended up being -$0.27, beating the consensus by 33.30%. EBITDA was $28.74 million for the quarter. At the end of Stitch Fix Inc.’s most recent quarter ended April 29, its liabilities totaled 358.3 million, while its total debt was $153.59 million. Equity owned by shareholders amounts to $108.73 million.

Technical Picture

Here’s a quick look at Stitch Fix Inc.’s (SFIX) price momentum from a technical perspective. As of 22 October, the RSI 9-day stood at 44.75%, suggesting the stock is Neutral, with a 32.96% historical volatility rate.

The stochastic %K and %D were 31.38% and 26.12% respectively, while the average true range (ATR) was 1.81. Based on the 14-day stochastic reading of 38.05%, the RSI (14) reading is 43.10%. On the 9-day MACD Oscillator, the stock is at 0.23, and the 14-day reading is at -0.14.

Analyst Ratings

In its analyst report released on October 05, 2021, Wedbush began covering Stitch Fix Inc. (NASDAQ: SFIX). The stock was rated as a Neutral by the brokerage firm. Analysts have assigned Stitch Fix Inc. (SFIX) an Hold rating. SFIX is a stock that is recommended for selling by 3 brokerage firms, while 7 companies recommend holding. The stock is underweighted by 0 analysts. Among the analysts who rate the stock, 0 rates it overweight and 6 others recommend it as a buy.

What is SFIX’s price target for the next 12 months?

The current consensus forecast for the stock is between $27.00 and $70.00, with a median target price of $46.00. In analyzing these forecasts, the average price target given by analysts for Stitch Fix Inc. (SFIX) is $49.47.


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