Just a heads up that Stitch Fix reports earnings after market today, and I’m very, very interested to see how it goes for them.
I think I know what to expect – consistency. Stitch Fix has been very good about communicating their targets and plans, and then delivering on their promises. When they raised guidance, their track record gave me confidence that they will deliver to plan.
I also think that the market’s reaction to Stitch Fix may be a hint at market sentiment overall. Stitch Fix’s stock has been beaten down and perhaps it is unusual because there is a lot of shorting of the company. It seems to me that the market can react in whatever way it wants – it can celebrate good earnings results, or it can hyper-focus on a small real, or even a perceived and not-so-real flaw and pound the stock. The stock market is fickle, and sentiment toward this company is very fickle.
Yet, they are profitable, they are growing, they are expanding, and they are delighting customers. I expect to hear very good news about their average revenue per customer, and overall customer growth since the company has been ramping up advertising. They have also expanded into the UK, a long term positive, but also an opportunity for the bearish types to get bashing. Like, OMG, look at all the money they’re spending! How dare they spend money to grow their business, what a failure signal!
I have seen many of the favorites on this board get beaten up over the details and perceived flaws, it is not uncommon at all.
Will the market see this company as the next-generation disruptor, or will it view clothing as a commodity and pooh-pooh the whole effort?
What drama. It will be a very curious evening, indeed. I am thankful for some youth hockey to get my head out of it.
Here is an earlier thread from Wouter about Stitch Fix that is a good read. I am glad that some on the board take an interest in Stitch Fix even though it deals in material goods and not bits and bytes.
https://discussion.fool.com/buying-sfix-34288756.aspx?sort=whole…
Anyway, I am expecting great results. The reaction? It could be anything. I also think that for people at Saul’s who entertain larger portfolios, Stitch Fix is a very interesting company to follow.
Karen