Stitch Fix (NASDAQ:SFIX) Shares Up 9.6% - Time to Buy?

Key Points

• Stitch Fix shares rose 9.6% to about $3.93, although trading volume was 62% below the average daily level.
• Analyst sentiment remains cautious: the stock has an average rating of “Hold” and an average price target of $5.12, with ratings ranging from Buy to Sell.
• The company beat quarterly expectations, reporting an adjusted loss of $0.01 per share versus the anticipated $0.06 loss and revenue of $340.28 million, up 4.7% year over year. However, insiders have sold more than 517,000 shares worth approximately $2.1 million over the past 90 days.

Stitch Fix, Inc. (NASDAQ:SFIX - Get Free Report) shares were up 9.6% on Monday . The company traded as high as $3.92 and last traded at $3.9250. Approximately 775,822 shares traded hands during mid-day trading, a decline of 62% from the average daily volume of 2,063,782 shares. The stock had previously closed at $3.58.

Analyst Ratings Changes

Several analysts recently commented on SFIX shares. Weiss Ratings upgraded shares of Stitch Fix from a "sell (e+)" rating to a "sell (d-)" rating in a report on Monday, July 13th. Northland Securities started coverage on shares of Stitch Fix in a research note on Thursday, May 28th. They issued an "outperform" rating and a $5.00 price objective on the stock. Wall Street Zen downgraded shares of Stitch Fix from a "buy" rating to a "hold" rating in a research report on Saturday, May 2nd. Finally, UBS Group lifted their target price on shares of Stitch Fix from $4.00 to $4.50 and gave the company a "neutral" rating in a research note on Thursday, June 11th. One analyst has rated the stock with a Buy rating, four have assigned a Hold rating and one has assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Hold" and an average target price of $5.12.

Stitch Fix Trading Up 9.5%

The firm has a market capitalization of $522.91 million, a price-to-earnings ratio of -48.99 and a beta of 2.26. The company has a fifty day moving average price of $3.76 and a 200-day moving average price of $3.83.

Stitch Fix (NASDAQ:SFIX - Get Free Report) last posted its earnings results on Wednesday, June 10th. The company reported ($0.01) earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($0.06) by $0.05. Stitch Fix had a negative net margin of 1.43% and a negative return on equity of 9.35%. The firm had revenue of $340.28 million during the quarter, compared to analysts' expectations of $333.51 million. During the same period in the previous year, the company earned ($0.06) earnings per share. The company's revenue was up 4.7% compared to the same quarter last year. As a group, sell-side analysts predict that Stitch Fix, Inc. will post -0.14 EPS for the current fiscal year.

Insider Activity

In other news, CFO David Aufderhaar sold 67,960 shares of the company's stock in a transaction dated Monday, July 6th. The stock was sold at an average price of $3.79, for a total transaction of $257,568.40. Following the completion of the sale, the chief financial officer owned 1,102,369 shares in the company, valued at approximately $4,177,978.51. This represents a 5.81% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Anthony Bacos sold 100,000 shares of the stock in a transaction dated Wednesday, June 24th. The shares were sold at an average price of $4.51, for a total value of $451,000.00. Following the transaction, the insider directly owned 1,071,994 shares in the company, valued at approximately $4,834,692.94. This represents a 8.53% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders have sold 517,971 shares of company stock worth $2,110,017. Corporate insiders own 16.09% of the company's stock.

Institutional Trading of Stitch Fix

Institutional investors and hedge funds have recently modified their holdings of the company. Arrowstreet Capital Limited Partnership increased its position in shares of Stitch Fix by 302.9% during the third quarter. Arrowstreet Capital Limited Partnership now owns 2,897,171 shares of the company's stock valued at $12,603,000 after purchasing an additional 2,178,156 shares during the period. Marshall Wace LLP boosted its stake in Stitch Fix by 4,898.1% during the second quarter. Marshall Wace LLP now owns 2,010,034 shares of the company's stock worth $7,437,000 after buying an additional 1,969,818 shares in the last quarter. Goldman Sachs Group Inc. increased its holdings in Stitch Fix by 73.3% in the 4th quarter. Goldman Sachs Group Inc. now owns 3,664,995 shares of the company's stock valued at $19,241,000 after buying an additional 1,549,902 shares during the period. Archon Capital Management LLC bought a new stake in Stitch Fix in the 4th quarter valued at $7,702,000. Finally, Intrinsic Edge Capital Management LLC acquired a new position in shares of Stitch Fix in the 4th quarter valued at $6,739,000. 71.04% of the stock is currently owned by institutional investors and hedge funds.

Stitch Fix Company Profile

Stitch Fix, Inc, headquartered in San Francisco, California, is a leading online personal styling service that blends data science with human expertise to deliver curated clothing and accessory selections. Founded in 2011 by Katrina Lake, the company pioneered a subscription-based model in which customers receive periodic “Fixes” tailored to their personal style, size and budget. Each shipment arrives with several handpicked items along with styling notes, allowing clients to review, purchase and return pieces at their convenience.

Clients begin by completing an online style profile that captures their measurements, design preferences and lifestyle needs.

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