Lovesac GAAP EPS of $1.74 misses by $0.01, revenue of $238.8M beats by $19.67M

• Lovesac press release (NASDAQ:LOVE): Q4 GAAP EPS of $1.74 misses by $0.01.
• Revenue of $238.8M (+21.7% Y/Y) beats by $19.67M.
• CEO comment: “Looking ahead to fiscal 2024, we will continue to surgically invest in growth initiatives and focus on strong execution to drive continued profitable growth.”

Comments

[Colin123456]

I am short post earnings. Why? Change of auditors, qualified audit opinions, barter (?!). Cash gross profit has been almost $100mm below reported gaap gross profit over the last three years, barter (!?) Again, questionable treatment of freight expense, falling per store productivity, imminent equity offering, (buybacks are a pipe dream) , and then the reasons already cited about a fad. Also, Listen to Restoration Hardware call from last week - he's telling you that high end furniture spending is going into the toilet.

Let's be clear - without the barter deal they would have missed EBITDA by a country mile - $21 mm whiff. This allowed them to move bad inventory off their books and take a GAIN INSTEAD OF A LOSS.
Anyone who owns this stock needs to go through the cash flows very carefully and also compare the reporting from 2020 to 2021/23 and to the third quarter Q. It's total bogus.

[K. Oakes]

@Colin123456 no one has really addressed your point. i want to delve into it more. the idea is that they are exchanging inventory (instead of selling it) in exchange for "media credits" that are then used for advertising. on its face, this doesnt seem bad. wouldnt the advertising costs come from somewhere anyway?

the past three years, revenue is up, net income is up, ebitda, eps. the company has no debt. again, this looks good. im trying to understand your point better. can you point to specifically where in the financials you feel like the sleight of hand is happening? i want to be convinced to sell my position and move on.

[Augie91]

LOVE this stock!!

[Hindsight Investor]

@Augie91 So cheap

[lbeachmike]

@Hindsight Investor Absolutely. I think it will be an easy double within two years barring macro catastrophe. Unfortunately I didn't load more at $22-23.