Rumors are swirling that Chinese fashion powerhouses Shein and Temu (NASDAQ:PDD) might be eyeing a deal with home goods retailer Wayfair (NYSE:W). Wayfair has been struggling with a dwindling customer base, which has led to a severe 82% drop in stock value over the past three years. Reports from The Information suggest that both Shein and Temu, known for their budget-friendly offerings, are exploring ways to improve their market positions and take on e-commerce titan Amazon (NASDAQ:AMZN).
The Information views Shein as the more likely candidate for Wayfair, pointing out that Shein could greatly benefit from Wayfair’s well-established U.S. warehouse and distribution network. Yet, the prospect of a merger is complicated by the tense U.S.-China political landscape. Indeed, the increasing scrutiny over Chinese investments in American businesses potentially makes any such deal challenging.
Is Wayfair Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on Wayfair stock based on 16 Buys, eight Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After a 95% rally in its share price over the past year, the average W price target of $68.04 per share implies 9.27% upside potential.
