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Rent the Runway
(NASDAQ:RENT)
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Rating:50Neutral
Price Target:
$1.50
▼(-58.45% Downside)
Action:Reiterated
Date:10/02/26
The score is held back primarily by weak financial resilience (negative equity and materially negative free cash flow) and bearish technicals (below all key moving averages with negative MACD). These are partly offset by improving operating metrics and positive earnings-call momentum (record revenue, margin/EBITDA improvement, reaffirmed guidance) and an optically low P/E, though liquidity-raising events introduce dilution/funding-risk considerations.
Positive Factors
Revenue and EBITDA improvement
Record quarterly revenue and sharply higher adjusted EBITDA indicate improving operating leverage as the platform scales. If maintained, stronger revenue productivity and expense discipline can support reinvestment, improve resilience, and move the business closer to durable profitability over the next several quarters.
Negative Factors
Negative shareholder equity
Materially negative equity remains a structural balance-sheet weakness even after debt reduction. It limits financial flexibility, reduces the cushion available to absorb operating setbacks, and can increase refinancing and credit risk while the company continues funding its rental platform.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and EBITDA improvement
Record quarterly revenue and sharply higher adjusted EBITDA indicate improving operating leverage as the platform scales. If maintained, stronger revenue productivity and expense discipline can support reinvestment, improve resilience, and move the business closer to durable profitability over the next several quarters.
Read all positive factors
Rent the Runway Key Performance Indicators (KPIs)
Any
Subscriber Breakdown
Provides a detailed look at the composition of subscribers, revealing trends in customer acquisition, retention, and the overall health of the subscription model.
Provides a detailed look at the composition of subscribers, revealing trends in customer acquisition, retention, and the overall health of the subscription model.
Data provided by:
The Fly
The FlyRent the Runway (RENT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$55.73M
Dividend YieldN/A
Average Volume (3M)215.12K
Price to Earnings (P/E)0.1
Beta (1Y)2.62
Revenue Growth21.17%
EPS GrowthN/A
CountryUS
Employees979
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Retail
Share Statistics
EPS (TTM)12.70
Shares Outstanding33,774,120
10 Day Avg. Volume180,860
30 Day Avg. Volume215,119
Financial Highlights & Ratios
PEG Ratio-0.03
Price to Book (P/B)-2.34
Price to Sales (P/S)0.26
P/FCF Ratio-1.81
Enterprise Value/Market Cap5.10
Enterprise Value/Revenue0.77
Enterprise Value/Gross Profit1.09
Enterprise Value/Ebitda1.51
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)-19.64
Revenue Forecast (FY)$302.60M
Rent the Runway Business Overview & Revenue Model
Company Description
Rent the Runway, Inc. operates a service that leases premium women's fashion and apparel. Customers can access these offerings through the company's online platform and its physical retail locations. Their extensive inventory spans a broad spectru...
How the Company Makes Money
Rent the Runway primarily makes money through recurring subscription fees paid by customers for access to a rotating wardrobe of rental items. Subscribers typically pay for plans that allow a set number of items per month and can exchange items du...
Rent the Runway Earnings Call Summary
Earnings Call Date:Sep 11, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Dec 09, 2026
Earnings Call Sentiment Positive
The call was predominantly positive. The company reported record revenue, strong year-over-year gross margin and adjusted EBITDA improvement, better year-to-date free cash flow, reaffirmed full-year guidance, continued customer-experience innovation, and additional liquidity support. These positives were tempered by a 3.8% decline in ending active subscribers, lower Reserve revenue, negative year-to-date free cash flow, paused initiatives, and expectations for flat to 3% Q3 revenue growth and negative Q3 adjusted EBITDA.Positive Updates
Record Quarterly Revenue
Second-quarter net revenue was $97.7 million, or approximately $98 million, an all-time company record. Revenue increased 20.8% year-over-year and 8.7% sequentially, ahead of the range communicated in June.
Negative Updates
Decline in Ending Active Subscribers
The company ended Q2 with 140,826 active subscribers, down 3.8% year-over-year. Management attributed the decline primarily to a higher year-over-year pause rate and fewer subscribers acquired after reducing the stronger promotional activity used in 2025.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Revenue
Second-quarter net revenue was $97.7 million, or approximately $98 million, an all-time company record. Revenue increased 20.8% year-over-year and 8.7% sequentially, ahead of the range communicated in June.
Read all positive updates
Company Guidance
For fiscal year 2026, Rent the Runway reiterated its double-digit revenue growth guidance and adjusted EBITDA guidance of 4%-7% of revenue, expects rental product investment to be in the range of $53 million-$55 million, compared with fiscal year 2025 of $75 million and previous guidance of $45 million-$50 million, and continues to expect improved free cash flow in 2026 compared to last year; for Q3 2026, it expects revenue to be between $87 million and $90 million, representing between flat to 3% growth versus Q3 2025, active subscribers to be roughly flat in the back half of 2026, Resale revenue to continue to grow in the second half, Reserve orders to grow, and adjusted EBITDA to be between negative 3% and negative 6% of revenue.Rent the Runway Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
28
Negative
Cash Flow
34
Negative
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 366.90M | 329.80M | 306.20M | 298.20M | 296.40M | 203.30M |
| Gross Profit | 260.40M | 196.00M | 67.70M | 60.80M | 55.10M | 8.90M |
| EBITDA | 188.40M | 65.70M | 13.30M | 25.70M | -4.70M | -67.20M |
| Net Income | 43.30M | 22.60M | -69.90M | -113.20M | -138.70M | -211.80M |
Balance Sheet | ||||||
| Total Assets | 192.40M | 221.00M | 509.60M | 534.60M | 336.20M | 447.50M |
| Cash, Cash Equivalents and Short-Term Investments | 29.00M | 50.40M | 77.40M | 84.00M | 154.50M | 247.60M |
| Total Debt | 196.00M | 198.30M | 380.80M | 356.60M | 315.20M | 312.80M |
| Total Liabilities | 257.90M | 257.10M | 692.10M | 656.90M | 371.50M | 376.40M |
| Stockholders Equity | -65.50M | -36.10M | -182.50M | -122.30M | -35.30M | 71.10M |
Cash Flow | ||||||
| Free Cash Flow | -50.30M | -46.60M | -40.70M | -98.20M | -118.70M | -83.40M |
| Operating Cash Flow | 700.00K | 3.50M | 12.90M | -15.70M | -47.70M | -42.30M |
| Investing Cash Flow | -35.40M | -49.50M | -20.10M | -54.60M | -44.30M | -22.50M |
| Financing Cash Flow | 19.70M | 18.60M | -300.00K | 700.00K | -4.00M | 215.20M |
Rent the Runway Technical Analysis
Negative
3.61
Price Trends
2.91
Negative
3.17
Negative
4.61
Negative
Market Momentum
-0.39
Negative
31.12
Neutral
38.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RENT, the sentiment is Negative. The current price of 3.61 is above the 20-day moving average (MA) of 1.85, above the 50-day MA of 2.91, and below the 200-day MA of 4.61, indicating a bearish trend. The MACD of -0.39 indicates Negative momentum. The RSI at 31.12 is Neutral, neither overbought nor oversold. The STOCH value of 38.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RENT.
Rent the Runway Risk Analysis
Rent the Runway disclosed 63 risk factors in its most recent earnings report. Rent the Runway 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
Rent the Runway Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $135.20M | 62.39 | 2.37% | 12.82% | 6.07% | ― | |
51 Neutral | $356.72M | -29.01 | -6.22% | ― | 6.39% | 57.76% | |
50 Neutral | $55.73M | 0.13 | -91.16% | ― | 21.17% | ― | |
49 Neutral | $248.30M | -27.99 | 4.27% | ― | -11.16% | -384.28% | |
45 Neutral | $37.14M | -4.18 | -903.25% | ― | -10.40% | 83.52% |
* Consumer Cyclical Sector Average
RENT
Rent the Runway
1.68
-3.31
-66.33%
TLYS
Tilly's
4.43
2.64
147.49%
SFIX
Stitch Fix
2.73
-1.68
-38.10%
CURV
Torrid Holdings
2.53
0.95
60.13%
LVLU
Lulu's Fashion Lounge Holdings
12.28
6.69
119.59%
Rent the Runway Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Rent the Runway Launches $15M Share Rights Offering
Positive
Sep 30, 2026
On September 30, 2026, Rent the Runway launched a previously announced $15 million rights offering for holders of its Class A common stock as of the September 25, 2026 record date, subject to due bill trading procedures that shift rights to purcha...
Business Operations and StrategyPrivate Placements and Financing
Rent the Runway Announces $15 Million Rights Offering
Neutral
Sep 15, 2026
On September 15, 2026, Rent the Runway announced that it will conduct a $15 million rights offering, setting September 25, 2026 as the record date for determining eligible holders of its Class A common stock. The offering will grant these sharehol...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Rent the Runway Announces $15 Million Rights Backstop
Positive
Sep 11, 2026
On September 11, 2026, Rent the Runway entered into a $15 million rights offering backstop agreement with an investor group comprising CHS US Investments, Gateway Runway and S3 RR Aggregator to bolster its financial position and flexibility. The c...
Business Operations and StrategyLegal Proceedings
Rent the Runway Settles IPO-Related Securities Class Action
Neutral
Sep 4, 2026
On September 3, 2026, Rent the Runway entered into a Stipulation and Agreement of Settlement to resolve a putative securities class action filed on November 14, 2022 in the Eastern District of New York, which alleged misleading statements and omis...
Business Operations and StrategyPrivate Placements and Financing
Rent the Runway Secures New $10M Term Loan
Positive
Sep 1, 2026
On September 1, 2026, Rent the Runway, Inc. entered into a Third Amendment to its Amended and Restated Credit Agreement with its existing lenders and CHS (US) Management LLC as administrative agent. The amendment establishes an incremental term lo...
Business Operations and StrategyRegulatory Filings and Compliance
Rent the Runway Updates Bylaws and Governance Framework
Neutral
Aug 13, 2026
On August 11, 2026, Rent the Runway’s board approved conforming amendments to its Third Amended Restated Bylaws, following the earlier stockholder-approved filing of its Thirteenth Amended and Restated Certificate of Incorporation in Delawa...
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Rent the Runway Implements Shareholder-Friendly Governance Changes
Positive
Jul 17, 2026
On July 14, 2026, Rent the Runway appointed Suchi Sastri as a Class III director and member of its Audit Committee, restoring compliance with Nasdaq rules requiring three independent directors on that committee; Sastri also waived compensation for...
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.