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The Lovesac Company (LOVE)
NASDAQ:LOVE
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The Lovesac Company
(NASDAQ:LOVE)
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Rating:63Neutral
Price Target:
$19.00
▲(33.90% Upside)
The Lovesac Company's overall stock score reflects solid financial performance and strategic growth initiatives, tempered by technical indicators suggesting bearish momentum and valuation concerns. The earnings call highlighted both growth opportunities and challenges, contributing to a balanced outlook.
Positive Factors
Market Share Growth
Increasing market share indicates competitive strength and brand recognition, positioning Lovesac for sustained growth in the home furnishings sector.
Product Innovation
Successful product launches like the Snug platform demonstrate Lovesac's ability to innovate and meet consumer demands, supporting long-term growth and market differentiation.
Financial Health
A strong balance sheet with ample liquidity and no debt enhances financial stability, enabling Lovesac to invest in growth opportunities and weather economic fluctuations.
Negative Factors
Decreased Gross Margin
A decline in gross margin due to increased costs can pressure profitability, challenging Lovesac's ability to maintain its competitive pricing and margin sustainability.
Net Loss Increase
Rising net losses indicate potential challenges in cost management and profitability, which could impact long-term financial health if not addressed.
Revenue Growth Volatility
Volatile revenue growth can signal market instability or competitive pressures, potentially affecting Lovesac's ability to achieve consistent financial performance.
The Lovesac Company (LOVE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$207.32M
Dividend YieldN/A
Average Volume (3M)542.09K
Price to Earnings (P/E)22.8
Beta (1Y)2.04
Revenue Growth-0.50%
EPS Growth26.88%
CountryUS
Employees920
SectorConsumer Cyclical
Sector Strength84
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)-0.45
Shares Outstanding14,610,309
10 Day Avg. Volume674,185
30 Day Avg. Volume542,089
Financial Highlights & Ratios
PEG Ratio-0.66
Price to Book (P/B)1.83
Price to Sales (P/S)0.58
P/FCF Ratio22.69
Enterprise Value/Market Cap2.00
Enterprise Value/Revenue0.60
Enterprise Value/Gross Profit1.04
Enterprise Value/Ebitda13.20
Forecast
1Y Price Target
$26.80Price Target Upside88.87% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
The Lovesac Company Business Overview & Revenue Model
Company DescriptionThe Lovesac Company designs, manufactures, and sells furniture. It offers sactionals, such as seats and sides; sacs, including foam beanbag chairs; and accessories comprising drink holders, footsac blankets, decorative pillows, fitted seat tables, and ottomans. As of January 30, 2022, the company operated 146 showrooms. It markets its products primarily through lovesac.com website, as well as showrooms at top tier malls, lifestyle centers, kiosks, mobile concierges, and street locations in 39 states of the United States; and in store pop-up- shops and shop-in-shops. The Lovesac Company was founded in 1995 and is headquartered in Stamford, Connecticut.
How the Company Makes MoneyThe Lovesac Company generates revenue through the direct sale of its furniture products, primarily through its online platform and retail showrooms. Key revenue streams include the sales of Sactionals, Sacs, and associated accessories. The company also benefits from a growing online presence, which has been bolstered by its e-commerce strategy, allowing for a wider customer reach. Additionally, Lovesac engages in partnerships with various home design and lifestyle brands, enhancing its product offerings and marketing efforts. The focus on high-quality, customizable products allows Lovesac to command premium pricing, contributing significantly to its overall earnings.
The Lovesac Company Earnings Call Summary
Earnings Call Date:Sep 11, 2025
(Q2-2026)
| % Change Since: |
Next Earnings Date:Dec 03, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed view with continued sales growth and successful product launches, but also highlighted significant challenges such as decreased gross margins and increased net losses. Although the company maintains a healthy balance sheet and increased market share, tariff pressures and competitive discounting remain concerns.Q2-2026 Updates
Positive Updates
Net Sales Increase
Total net sales were $160.5 million, reflecting a year-over-year increase of 2.5% despite a 4% decline in the category.
Omnichannel Comparable Sales Growth
Total omnichannel comparable net sales increased 0.9% for the quarter, with additional growth from new and non-comp touchpoint contributions.
Healthy Balance Sheet
The company maintains a strong balance sheet with $34.2 million in cash and cash equivalents, no borrowings on the credit facility, and healthy inventory levels.
Successful Product Launches
The launch of the Snug platform, initially branded as EverCouch, has been expanded to over 100 locations with promising initial results.
Increased Market Share
Lovesac gained market share, ranking number nineteen on the largest home furnishings retailer list with a 3.7% increase from May through July.
Negative Updates
Decreased Gross Margin
Gross margin decreased 260 basis points to 56.4% of net sales, driven by higher inbound and outbound transportation costs and increased promotional discounts.
Net Loss Increase
Net loss for the quarter was $6.7 million, compared to a net loss of $5.9 million in the prior year period.
Challenges with Tariffs
Incremental worsening in the tariff backdrop and continued pressure on competitive discounting led to a reduction in the gross margin range.
Decreased Internet Sales
Internet net sales decreased $1.8 million or 4.1% to $42.5 million in the second quarter compared to the prior year period.
Other Sales Decline
Other net sales decreased $4.5 million or 33.6% due to the decision not to engage in barter transactions during the current period.
Company Guidance
During The Lovesac Company's second quarter fiscal 2026 earnings call, the company provided detailed guidance highlighting several key metrics. Total net sales for the quarter were $160.5 million, marking a year-over-year increase of 2.5%, despite a 4% decline in the overall category. Omnichannel comparable net sales grew by 0.9%, supported by new and non-comp touchpoints. Gross margin decreased by 260 basis points to 56.4%, primarily due to increased transportation costs and higher promotional discounts. For fiscal 2026, the company forecasts net sales between $710 million and $740 million, with adjusted EBITDA projected to range from $42 million to $55 million. The company remains focused on expanding its market share through strategic pricing and enhanced customer acquisition strategies, while managing controllable expenses to maintain profitability.The Lovesac Company Financial Statement Overview
Summary
The Lovesac Company demonstrates solid financial performance with strong profitability and efficient cash flow management. However, the increase in leverage and recent revenue decline pose potential risks. Continued focus on revenue growth and managing debt levels will be crucial for sustaining financial stability.Income Statement
The company's income statement shows strong profitability with a consistent gross profit margin over the years. The net profit margin has improved significantly since 2020, indicating better cost management. However, revenue growth has been volatile, with a decline in the most recent year. The EBIT and EBITDA margins remain healthy, supporting overall profitability.72
Positive
Balance Sheet
The balance sheet reflects moderate financial health. The debt-to-equity ratio has increased, suggesting higher leverage and potential risk. Return on equity is positive, indicating efficient use of shareholder funds. The equity ratio is stable, reflecting a solid financial foundation, although the increasing liabilities warrant close monitoring.65
Positive
Cash Flow
Cash flow analysis reveals a strong free cash flow growth in recent years, recovering from previous negative figures. The operating cash flow to net income ratio is favorable, indicating effective cash generation from operations. However, the free cash flow to net income ratio shows some volatility, suggesting potential challenges in capital expenditure management.68
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 686.36M | 680.63M | 700.26M | 651.18M | 498.24M | 320.74M |
| Gross Profit | 400.16M | 397.83M | 401.04M | 343.65M | 273.53M | 174.77M |
| EBITDA | 31.37M | 28.36M | 42.68M | 47.81M | 48.44M | 21.49M |
| Net Income | 13.68M | 11.56M | 23.86M | 26.49M | 47.49M | 14.73M |
Balance Sheet | ||||||
| Total Assets | 483.74M | 532.25M | 482.18M | 408.63M | 369.08M | 171.02M |
| Cash, Cash Equivalents and Short-Term Investments | 26.90M | 83.73M | 87.04M | 43.53M | 92.39M | 78.34M |
| Total Debt | 191.64M | 183.02M | 175.50M | 146.57M | 108.51M | 0.00 |
| Total Liabilities | 282.53M | 315.89M | 264.68M | 215.53M | 211.27M | 63.07M |
| Stockholders Equity | 201.21M | 216.35M | 217.50M | 193.09M | 157.81M | 107.95M |
Cash Flow | ||||||
| Free Cash Flow | -18.30M | 17.46M | 47.23M | -46.92M | 17.53M | 31.47M |
| Operating Cash Flow | 4.61M | 38.98M | 76.44M | -21.38M | 32.65M | 40.52M |
| Investing Cash Flow | -22.91M | -21.52M | -29.21M | -25.55M | -15.12M | -9.05M |
| Financing Cash Flow | -27.16M | -20.76M | -3.73M | -1.94M | -3.48M | -1.67M |
The Lovesac Company Technical Analysis
Negative
14.19
Price Trends
18.04
Negative
18.43
Negative
19.76
Negative
Market Momentum
-0.96
Positive
24.08
Positive
3.29
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOVE, the sentiment is Negative. The current price of 14.19 is below the 20-day moving average (MA) of 16.90, below the 50-day MA of 18.04, and below the 200-day MA of 19.76, indicating a bearish trend. The MACD of -0.96 indicates Positive momentum. The RSI at 24.08 is Positive, neither overbought nor oversold. The STOCH value of 3.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOVE.
The Lovesac Company Risk Analysis
The Lovesac Company disclosed 53 risk factors in its most recent earnings report. The Lovesac Company 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
The Lovesac Company Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $686.03M | 13.39 | 10.69% | 7.12% | -4.89% | -19.26% | |
66 Neutral | $135.06M | 17.41 | 4.70% | 5.14% | -2.74% | ― | |
63 Neutral | $207.32M | 22.77 | 6.45% | ― | -0.50% | 26.88% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $119.01M | 10.04 | 19.99% | ― | 30.09% | -33.19% | |
46 Neutral | $96.21M | ― | -6.33% | 10.28% | -6.46% | -1110.82% | |
46 Neutral | $135.94M | ― | 9.10% | ― | -14.40% | -2.14% |
* Consumer Cyclical Sector Average
LOVE
The Lovesac Company
14.19
-13.36
-48.49%
BSET
Bassett Furniture
15.55
2.29
17.27%
ETD
Ethan Allen
26.96
-1.20
-4.26%
HOFT
Hooker Furniture
8.95
-6.07
-40.41%
KEQU
Kewaunee Scientific
41.53
8.69
26.46%
SNBR
Sleep Number
5.97
-8.64
-59.14%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.