The third quarter earnings report released from modular furniture maker Lovesac (NASDAQ:LOVE) was a huge hit with investors. How big? Big enough to send shares up over 10% in Wednesday afternoon’s trading and keep them there for much of the afternoon itself.
Getting that kind of result out of one earnings report suggests it must have been impressive indeed. Lovesac brought in beats on several key metrics, including revenue and earnings. The only piece of bad news it brought out was a net loss of $0.15 per share, but this was significantly ahead of the $0.30 per share loss analysts were looking for.
Meanwhile, revenue came in nicely ahead of expectations, posting $154.04 million against analyst expectations of $153.81 million. Better yet, that represents a 14.3% jump against this time last year, suggesting that a lot more people were shopping for home furnishings than expected.
A Surfeit of Options Gives Lovesac an Edge
The obvious question, of course, follows. How did Lovesac manage to fare so well in an environment where shoppers are watching their every penny like a hawk? The answer appears to be by offering an option for just about everybody. For instance, Lovesac teamed up with Microsoft (NASDAQ:MSFT) recently to offer gamers a package that featured Lovesac’s StealthTech Sound + Charge system and an Xbox Series S console free when buying the couch.
Furthermore, several articles reference points like the value of the Citysac for small apartments and the wide array of options from there. While Lovesac chairs are pricey, their range likely gives them access to a few more markets than they would have had.
Is Lovesac a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on LOVE stock based on four Buys assigned in the past three months, as indicated by the graphic below. After a 30.77% rally in its share price over the past year, the average LOVE price target of $42.67 per share implies 85.52% upside potential.
