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Culp (CULP)
NYSE:CULP
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Culp
(NYSE:CULP)
45Neutral
Culp (CULP) vs. S&P 500 (SPY)
Market Cap
$51.49M
Dividend YieldN/A
Average Volume (3M)18.05K
Price to Earnings (P/E)―
Beta (1Y)0.47
Revenue Growth-9.80%
EPS Growth-59.08%
CountryUS
Employees1,000
SectorConsumer Cyclical
Sector Strength74
IndustryApparel - Manufacturers
Share Statistics
EPS (TTM)-0.33
Shares Outstanding12,559,129
10 Day Avg. Volume11,188
30 Day Avg. Volume18,053
Financial Highlights & Ratios
PEG Ratio0.21
Price to Book (P/B)0.84
Price to Sales (P/S)0.00
P/FCF Ratio-3.45
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue0.06
Enterprise Value/Gross Profit2.45
Enterprise Value/Ebitda-1.48
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Culp Business Overview & Revenue Model
Company DescriptionCulp, Inc. (CULP) is a leading U.S.-based manufacturer and marketer in the home furnishings industry, particularly known for its innovative and high-quality fabrics. The company operates primarily in two segments: mattress fabrics and upholstery fabrics. Culp's mattress fabrics division manufactures and sells fabrics used in the production of mattresses, while its upholstery fabrics division provides a wide range of decorative fabrics for furniture applications. With a strong emphasis on design and product development, Culp serves a diverse customer base that includes furniture and bedding manufacturers across the globe.
How the Company Makes MoneyCulp makes money primarily through the sale of its fabrics and related products to manufacturers in the furniture and bedding industries. Its revenue model is based on manufacturing and distributing a variety of textile products, including woven and knitted fabrics, which are sold to mattress and furniture manufacturers. The company's key revenue streams include domestic and international sales of these products, leveraging its manufacturing capabilities and design expertise. Significant partnerships with furniture and mattress manufacturers help drive sales, as these relationships ensure a steady demand for Culp's innovative and tailored fabric solutions. Additionally, the company's focus on operational efficiency and product innovation supports its competitive position and contributes to its earnings.
Culp Financial Statement Overview
Summary
Culp faces significant financial challenges characterized by declining revenues, persistent net losses, and negative cash flows. While the balance sheet showcases strong equity financing, the overall financial health is undermined by poor profitability metrics and cash flow difficulties, highlighting the need for strategic improvements in operations and cost management.Income Statement
The income statement shows a concerning trend with declining revenues and persistent net losses over the past years. The TTM period reflects a net profit margin of -10.24%, indicating ongoing profitability challenges. The gross profit margin has also declined, suggesting cost management issues. Despite these challenges, there is a slight improvement in EBIT margin compared to the previous year, though it remains negative.40
Negative
Balance Sheet
Culp's balance sheet presents a stable equity base, but the debt-to-equity ratio is relatively low at 0.04, indicating low leverage. The equity ratio of 100% in the TTM period shows a strong reliance on equity financing. However, the return on equity remains negative due to sustained net losses, highlighting profitability issues.50
Neutral
Cash Flow
The cash flow analysis reveals negative free cash flow growth, with the TTM period showing a free cash flow of -$14.58 million. The operating cash flow to net income ratio is negative, driven by consistent negative operating cash flows, which may affect liquidity and financial flexibility moving forward.35
Negative
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 213.99M | 225.33M | 234.93M | 294.84M | 299.72M | 256.17M | Gross Profit |
| 22.61M | 27.94M | 10.90M | 36.09M | 49.83M | 40.50M | EBIT |
| -20.18M | -11.31M | -27.08M | -308.00K | 10.11M | 6.07M | EBITDA |
| -14.01M | -3.85M | -21.11M | 7.25M | 19.42M | 551.00K | Net Income Common Stockholders |
| -21.90M | -13.82M | -31.52M | -3.21M | 3.22M | -11.03M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 7.03M | 10.91M | 22.37M | 14.55M | 45.71M | 74.98M | Total Assets |
| 127.56M | 132.05M | 152.18M | 177.56M | 214.08M | 215.08M | Total Debt |
| 10.54M | 4.48M | 6.25M | 10.28M | 9.56M | 42.19M | Net Debt |
| 5.26M | -5.53M | -14.71M | -4.27M | -27.45M | -27.60M | Total Liabilities |
| 67.91M | 55.92M | 63.10M | 58.06M | 85.07M | 85.39M | Stockholders Equity |
| 59.65M | 76.13M | 89.08M | 119.50M | 129.01M | 129.70M |
| Cash Flow | Free Cash Flow | ||||
| -14.58M | -11.94M | 5.70M | -23.14M | 14.81M | 385.00K | Operating Cash Flow |
| -11.68M | -8.22M | 7.80M | -17.44M | 21.48M | 4.97M | Investing Cash Flow |
| -925.00K | -2.43M | -752.00K | 2.50M | -10.68M | -5.71M | Financing Cash Flow |
| 5.35M | -126.00K | -436.00K | -7.42M | -43.71M | 30.64M |
Culp Technical Analysis
Neutral
4.10
Price Trends
4.39
Negative
4.90
Negative
5.13
Negative
Market Momentum
-0.06
Negative
51.01
Neutral
42.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CULP, the sentiment is Neutral. The current price of 4.1 is above the 20-day moving average (MA) of 3.89, below the 50-day MA of 4.39, and below the 200-day MA of 5.13, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 51.01 is Neutral, neither overbought nor oversold. The STOCH value of 42.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CULP.
Culp Risk Analysis
Culp disclosed 22 risk factors in its most recent earnings report. Culp reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Culp Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $6.98B | 11.35 | 2.88% | 3.90% | 2.65% | -21.84% | |
51 Neutral | $40.45M | ― | -5.77% | 6.08% | 15.70% | -337.22% | |
48 Neutral | $181.47M | ― | -13.39% | 0.63% | 34.10% | -432.13% | |
48 Neutral | $85.56M | ― | -15.73% | ― | 2.51% | 32.95% | |
47 Neutral | $22.09M | 6.22 | -42.84% | ― | 0.19% | -173.33% | |
45 Neutral | $51.49M | ― | -31.18% | ― | -9.80% | -59.08% | |
44 Neutral | $6.24M | ― | -47.20% | ― | -52.20% | -0.80% |
* Consumer Cyclical Sector Average
Performance Comparison
CULP
Culp
4.10
-0.27
-6.18%
LAKE
Lakeland Industries
19.08
2.10
12.37%
UFI
Unifi
4.66
-1.63
-25.91%
VNCE
Vince Holding
1.72
0.05
2.99%
XELB
XCel Brands
2.63
-4.24
-61.72%
JRSH
Jerash Holdings (US)
3.29
0.38
13.06%
Culp Earnings Call Summary
Earnings Call Date:Mar 05, 2025
(Q3-2025)
| % Change Since: -18.33%|
Next Earnings Date:Jun 25, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant improvements in operational efficiencies and market share growth in the Mattress Fabrics and hospitality contract businesses, driven by successful restructuring and innovation efforts. However, these positive developments were counterbalanced by a notable decline in overall sales, particularly in the residential upholstery segment, and a continued net loss. The call also addressed the challenges posed by tariff and trade uncertainties.Q3-2025 Updates
Positive Updates
Mattress Fabrics Segment Restructuring Success
Achieved a 58.3% sequential reduction in operating loss in the Mattress Fabrics segment, building on a 70.7% reduction in the previous quarter. Restructuring initiatives have been largely completed, leading to improved efficiencies and cost savings.
Near Breakeven Adjusted EBITDA
Achieved near breakeven consolidated adjusted EBITDA for the quarter with a $1.1 million improvement sequentially compared to last quarter, despite $3.4 million less in sales.
Hospitality Contract Business Growth
Sales for the hospitality contract business increased both year-over-year and sequentially, representing 40% of upholstery fabrics total sales for the quarter.
Successful Product Development and Innovation
Introduced new product capabilities such as quilted mattress covers and patented FR inlay for flame retardant knit products. Expanded window treatment offerings with new hotel brand standards.
Negative Updates
Overall Sales Decline
Net sales were down 13.5% compared with the prior year period, primarily due to ongoing weakness in the home furnishings and bedding industries.
Residential Upholstery Fabric Sales Pressure
Residential upholstery fabric sales were significantly pressured by weak industry demand and inventory adjustments from a large customer, leading to year-over-year and sequential declines.
Net Loss for the Quarter
Reported a net loss of $4.1 million or $0.33 per diluted share, compared with a net loss of $3.2 million or $0.26 per diluted share for the prior year period.
Tariff and Trade Uncertainty
Ongoing uncertainty around tariffs and global trade issues are impacting sales and customer projects, particularly affecting upholstery fabrics with about 30% of China-produced fabrics shipped to the USA.
Company Guidance
During the Culp, Inc. Third Quarter Fiscal 2025 Earnings Conference Call, the company provided detailed guidance on its financial outlook and restructuring efforts. Culp reported a sequential improvement in operating results despite macroeconomic challenges, with a 58.3% reduction in operating loss in the Mattress Fabrics segment, building on a 70.7% reduction from the previous quarter. The company achieved near breakeven consolidated adjusted EBITDA for the quarter, marking a $1.1 million improvement sequentially. Culp also highlighted a significant restructuring initiative in the Mattress Fabrics segment, including stopping production at its Canadian facility and relocating equipment to North Carolina. The sale of the Canadian facility is anticipated to generate $6 million to $8 million in cash proceeds. Moreover, Culp is targeting additional annualized savings of approximately $1 million through labor and professional fee cost-saving actions, on top of the $10 million to $11 million from the restructuring plan, and is exploring further strategic actions for fiscal 2026. Despite industry pressures, Culp remains optimistic about gaining market share, particularly in the Mattress Fabrics and hospitality contract fabric businesses, which have shown sequential and year-over-year sales growth.Culp Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Culp Announces Strategic Transformation of Operating Model
Positive
Apr 24, 2025
On April 24, 2025, Culp, Inc. announced a strategic transformation of its operating model by integrating its two divisions, Culp Upholstery Fabrics and Culp Home Fashions, into a single business. This move aims to enhance operational agility, streamline costs, and improve responsiveness to market trends. The integration involves closing a facility in Burlington, North Carolina, and relocating operations to Stokesdale, North Carolina, with expected annual savings of $3 million. This follows a previous restructuring plan from May 2024, which anticipated savings of $10 to $11 million. The changes also include leadership appointments, with Mary Elizabeth Hunsberger as Chief Operating Officer and Thomas M. Bruno as Chief Commercial Officer. The transformation is expected to create synergies and strengthen Culp’s market position in the home furnishings industry.
Spark’s Take on CULP Stock
According to Spark, TipRanks’ AI Analyst, CULP is a Neutral.
Culp’s overall stock score reflects significant financial challenges, primarily due to ongoing net losses and negative cash flows, despite strong equity financing. Technical indicators suggest the stock is currently oversold, which could lead to a short-term correction. However, the lack of profitability and unattractive valuation metrics weigh heavily on the score. Recent earnings call improvements in operational efficiencies and market share growth provide a glimmer of hope, but they are insufficient to offset persistent sales declines and profitability issues.
To see Spark’s full report on CULP stock, click here.
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Culp Expands Board Amidst Financial Restructuring
Neutral
Mar 5, 2025
On March 5, 2025, Culp, Inc. announced the election of William L. Tyson to its Board of Directors, expanding the board from seven to eight members. Tyson, with over 30 years of experience in investment banking and capital markets, is expected to bring strategic growth insights to the company. Concurrently, Culp reported its third-quarter fiscal 2025 results, highlighting a consolidated net sales decline to $52.3 million, a 6.1% sequential drop. Despite the sales decline, the company saw improvements in its mattress fabrics segment due to restructuring efforts, achieving a 58.3% reduction in operating loss. Culp also entered a conditional agreement to sell its Canadian real estate, expecting $6.0 to $8.0 million in proceeds, which will aid in liquidity and debt reduction. The company remains optimistic about future profitability and market share growth, driven by a streamlined cost structure and ongoing restructuring benefits.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.