Why Did Stifel Nicolaus Upgrade Stitch Fix Inc’s Stock?


Stitch Fix Inc (SFIX) received a Buy rating and a $35 price target from Stifel Nicolaus analyst Scott Devitt yesterday. The company’s shares closed on Friday at $26.90.

Devitt wrote:

“We are upgrading $35 price target. The stock has sold off ~16% since the beginning of July (versus the and shares are now trading at ~1.3x CY:20 sales, which we believe offers an attractive entry point. Despite the slowdown in active client growth, we are confident in management’s ability to drive healthy ARPU growth in the intermediate term by continuing to improve keep rates through stronger personalization (Style Shuffle), high-quality client adds, and healthy retention. Additionally, the scaling of the U.K. business represents an additional opportunity for active client growth, and we believe new features/capabilities, such as the ability to buy individual items and the potential to add more items per fix, could support further upside.”

According to TipRanks.com, Devitt is a top 100 analyst with an average return of 22.5% and a 71.2% success rate. Devitt covers the Technology sector, focusing on stocks such as Jumia Technologies AG, Uber Technologies Inc, and Eventbrite Inc.

Currently, the analyst consensus on Stitch Fix Inc is a Moderate Buy with an average price target of $37, which is a 37.5% upside from current levels. In a report issued on July 12, Goldman Sachs also upgraded the stock to Buy with a $38 price target.

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Stitch Fix Inc’s market cap is currently $2.71B and has a P/E ratio of 57.68. The company has a Price to Book ratio of 7.23.

Based on the recent corporate insider activity of 76 insiders, corporate insider sentiment is negative on the stock.

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Stitch Fix, Inc. is an online personal styling service that delivers personalized Fixes of apparel and accessories to men, women and kids. The company was founded by Katrina Lake and Erin Morrison Flynn in February 2011 and is headquartered in San Francisco, CA.

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