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1. Company Snapshot

1.a. Company Description

Stitch Fix, Inc.sells a range of apparel, shoes, and accessories through its Website and mobile application in the United States.It offers denim, dresses, blouses, skirts, shoes, jewelry, and handbags for men, women, and kids under the Stitch Fix brand.


The company was formerly known as rack habit inc.and changed its name to Stitch Fix, Inc.in October 2011.


Stitch Fix, Inc.was incorporated in 2011 and is headquartered in San Francisco, California.

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1.b. Last Insights on SFIX

Stitch Fix's recent performance was driven by its solid Q1 earnings beat, with a narrower-than-expected loss of $0.05 per share. The company's gross margin rose year-over-year, driven by AI-driven personalization and product assortment improvements. Additionally, Stitch Fix's focus on operational efficiency, innovative personalization, and strategic marketing has led to a strong commitment to client satisfaction. The company aims to drive revenue growth by fiscal 2026, making it an attractive choice for investors seeking growth opportunities.

1.c. Company Highlights

2. Stitch Fix Delivers Strong Q1 2026 Results with Revenue Growth and Market Share Gains

Stitch Fix reported revenue of $342.1 million for Q1 2026, exceeding expectations and representing a 7.3% year-over-year increase. Adjusted EBITDA was $13.4 million, approximately 4% of revenue. The company's earnings per share (EPS) was -$0.05, in line with estimates. Gross margin was 43.6%, within the FY 2026 guided range. The company's strong performance was driven by its client-centric and personalized shopping experience, with active clients reaching 2.3 million, at the high end of expectations. Revenue per active client was $559, up 5.3% year-over-year.

Publication Date: Dec -07

📋 Highlights
  • Revenue Growth:: Q1 revenue hit $342.1M (+7.3% YoY), surpassing guidance, driven by women's fall sales (19% YoY growth in sweaters/coats) and men's double-digit growth.
  • Adjusted EBITDA:: Reached $13.4M (4% of revenue), reflecting improved profitability despite gross margin dip to 43.6% (-180 bps due to transportation costs).
  • Client Metrics:: 2.3M active clients (high end of guidance) with $559 net revenue per client (+5.3% YoY), fueled by higher items per client and new categories.
  • Full-Year Guidance:: Raised to $1.32B–$1.35B revenue and $38M–$48M adjusted EBITDA, reflecting confidence in market share gains and holiday sales momentum.
  • AI & Innovation:: Early success with Stitch Fix Vision (AI/visualization tools) and Family Accounts (92% of women's clients gifting), boosting engagement and client LTV (+17% YoY).

Business Segment Performance

Both women's and men's businesses drove the company's growth, with women's seeing a strong start to fall sales, particularly in sweaters, coats, jackets, and vests, which grew 19% year-over-year, while sneakers grew 63%. Men's delivered a second consecutive quarter of double-digit revenue growth. The company is seeing strength across all income segments, driven by increased client engagement and unit sales, rather than inflation.

Operational Highlights and Guidance

Stitch Fix is focused on delivering growth by leveraging its competitive differentiation in data science and AI. The company is encouraged by the early adoption of its consumer-facing AI and visualization tools, Stitch Fix Vision. For Q2, the company expects revenue to be between $335 million and $340 million, and adjusted EBITDA to be between $10 million and $13 million. The company raised its full-year guidance, expecting total revenue to be between $1.32 billion and $1.35 billion, and total adjusted EBITDA to be between $38 and $48 million.

Valuation and Outlook

With a P/S Ratio of 0.52, the market appears to have a relatively modest expectation for Stitch Fix's revenue growth. Analysts estimate next year's revenue growth at 6.2%. Given the company's strong Q1 performance and raised full-year guidance, it is well-positioned to potentially exceed these expectations. However, with an EV/EBITDA ratio of -104.2, the market has high expectations for the company's future profitability. The company's focus on delivering a superior retail experience with convenience, personalization, service, inspiration, and innovation is likely to drive its long-term growth.

3. NewsRoom

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Stitch Fix: Buyer Stabilization And Average Order Growth (Upgrade)

Dec -05

Source: seekingalpha.com

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Stitch Fix to Participate in KeyBanc Capital Markets Virtual December Consumer Spotlight

Dec -05

Source: businesswire.com

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SFIX Q1 Loss Meet, Revenues Beat on Robust Client Engagement

Dec -05

Source: zacks.com

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Is Stitch Fix (SFIX) Stock Outpacing Its Retail-Wholesale Peers This Year?

Dec -05

Source: zacks.com

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Breakfast News: WBD Sells To Netflix

Dec -05

Source: fool.com

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Stitch Fix, Inc. (SFIX) Q1 2026 Earnings Call Transcript

Dec -05

Source: seekingalpha.com

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Stitch Fix (SFIX) Reports Q1 Loss, Beats Revenue Estimates

Dec -04

Source: zacks.com

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Stitch Fix Announces First Quarter of Fiscal 2026 Financial Results

Dec -04

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.00%)

6. Segments

Personalization

Expected Growth: 1.0%

Stitch Fix's 1.0 growth in personalization is driven by its proprietary styling algorithm, which leverages customer data and preferences to offer curated fashion choices. Additionally, the company's focus on convenience, flexibility, and personalized interactions through its 'Fix' model, as well as its expanding product offerings and effective marketing strategies, contribute to its growth in this segment.

7. Detailed Products

Women's Clothing

Personalized clothing for women, including tops, dresses, pants, and outerwear

Men's Clothing

Personalized clothing for men, including shirts, pants, jeans, and outerwear

Kids' Clothing

Personalized clothing for kids, including casual wear, dresses, and outerwear

Plus Sizes

Personalized clothing for plus-size women, including trendy and comfortable clothing

Maternity Wear

Personalized clothing for pregnant women, including comfortable and stylish maternity wear

Petite Sizes

Personalized clothing for petite women, including trendy and comfortable clothing

Stitch Fix Freestyle

A personalized shopping experience that allows customers to purchase individual items

8. Stitch Fix, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Stitch Fix's personalized styling service and curated clothing offerings create a unique experience for customers, making it difficult for substitutes to replicate. However, the rise of AI-powered styling tools and online fashion platforms may pose a moderate threat.

Bargaining Power Of Customers

Stitch Fix's customers have significant bargaining power due to the ease of switching to competitors and the availability of alternative fashion retailers. Additionally, customers can easily share their dissatisfaction on social media, affecting the company's reputation.

Bargaining Power Of Suppliers

Stitch Fix has a diverse supplier base, which reduces dependence on individual suppliers. The company's strong relationships with suppliers and its ability to negotiate prices also limit the bargaining power of suppliers.

Threat Of New Entrants

While entering the personalized fashion market requires significant investment in technology, logistics, and marketing, new entrants can still pose a threat to Stitch Fix. However, the company's established brand and customer base provide a barrier to entry.

Intensity Of Rivalry

The personalized fashion market is highly competitive, with established players like Trunk Club and Le Tote, as well as new entrants. Stitch Fix faces intense competition in terms of pricing, quality, and customer experience.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 38.49%
Debt Cost 3.95%
Equity Weight 61.51%
Equity Cost 13.63%
WACC 9.90%
Leverage 62.58%

11. Quality Control: Stitch Fix, Inc. passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Stitch Fix

A-Score: 3.8/10

Value: 6.4

Growth: 2.7

Quality: 3.5

Yield: 0.0

Momentum: 8.5

Volatility: 1.7

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Victoria's Secret

A-Score: 3.5/10

Value: 5.2

Growth: 3.3

Quality: 3.8

Yield: 0.0

Momentum: 6.5

Volatility: 2.3

1-Year Total Return ->

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Duluth Holdings

A-Score: 3.5/10

Value: 9.8

Growth: 1.4

Quality: 4.4

Yield: 0.0

Momentum: 4.0

Volatility: 1.3

1-Year Total Return ->

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Rent the Runway

A-Score: 3.4/10

Value: 10.0

Growth: 4.3

Quality: 5.1

Yield: 0.0

Momentum: 0.5

Volatility: 0.3

1-Year Total Return ->

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Zumiez

A-Score: 2.9/10

Value: 4.4

Growth: 2.1

Quality: 3.9

Yield: 0.0

Momentum: 4.0

Volatility: 3.0

1-Year Total Return ->

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Stock-Card
Allbirds

A-Score: 2.8/10

Value: 9.4

Growth: 1.4

Quality: 3.9

Yield: 0.0

Momentum: 1.0

Volatility: 1.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

5.41$

Current Price

5.41$

Potential

-0.00%

Expected Cash-Flows