Stitch Fix: This Unique E-Commerce Brand Is Poised To Continue Expanding

Oct. 24, 2021 7:16 AM ETStitch Fix, Inc. (SFIX) StockSFIX1 Comment
Gary Alexander
31.2K Followers

Summary

  • Shares of Stitch Fix have declined 40% this year, as investors have lamented the departure of its founder/CEO Katrina Lake.
  • Fundamentally, the company has continued to perform after a weak pandemic year. Revenue growth is currently trending around ~30% y/y.
  • Stitch Fix's guidance calls for just 15% y/y growth in the FY22 it just entered, which may be pessimistic.
  • Stitch Fix's valuation at ~2x forward revenue for a ~50% gross margin profile leaves room for upside.

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With the stock market continuing to bob around at all-time highs, investing in unique growth stocks at a decent valuation has become a true challenge. Stitch Fix (NASDAQ:SFIX), however, bears a very close second look

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This article was written by

31.2K Followers
With combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on Seeking Alpha since 2017. He has been quoted in many web publications and his articles are syndicated to company pages in popular trading apps like Robinhood.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of SFIX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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