Revolve Group Inc (RVLV, Financial), a prominent player in the retail-cyclical industry, has experienced a notable uptick in its stock performance. With a current market capitalization of $1.11 billion and a stock price of $15.39, the company has seen a significant 15.54% gain over the past week and a 15.71% gain over the past three months. This growth trajectory is underscored by the GF Value of $33.66, which suggests that the stock is significantly undervalued compared to its past GF Value of $36.01. The current and past GF Valuations both indicate that Revolve Group Inc remains significantly undervalued, presenting a potentially attractive opportunity for value investors.
Revolve Group Inc: A Digital Fashion Powerhouse
Revolve Group Inc is an e-commerce retailer that has carved out a niche in women's fashion and beauty products. The company's innovative approach, focusing on mobile commerce and influencer marketing, has positioned it as a go-to platform for the next-generation customer. With net sales surpassing $1.1 billion in 2022, Revolve Group is a formidable presence just outside the top 30 apparel retailers in the U.S. The company's success is partly due to its 20%-25% top-line growth, which capitalizes on the industry's shift towards digital channels. Revolve's strategy includes a mix of private-label offerings and a curated selection of unique products from emerging fashion brands, making it a standout in the aspirational luxury space.
Assessing Revolve's Profitability
Revolve Group Inc's Profitability Rank stands at a robust 7/10, reflecting its solid financial health. The company's Operating Margin of 2.86% is better than 47.25% of 1109 companies in the industry. Additionally, its ROE of 8.36%, ROA of 5.33%, and ROIC of 8.80% are all commendable, outperforming a majority of their peers. With six years of profitability over the past decade, Revolve Group Inc demonstrates a consistent ability to generate profits, which is a positive sign for potential investors.
Growth Trajectory of Revolve Group Inc
The Growth Rank for Revolve Group Inc is also at 7/10, indicating a strong growth profile. Despite a 3-Year Revenue Growth Rate per Share decline of -42.50%, the company's 5-Year Revenue Growth Rate per Share has increased by 12.50%. Looking ahead, the estimated Total Revenue Growth Rate for the next 3 to 5 years is 4.73%. The EPS growth rates are even more impressive, with a 3-Year EPS without NRI Growth Rate of 16.50% and a 5-Year EPS without NRI Growth Rate of 54.80%. The future EPS Growth Rate is projected at 18.31%, suggesting that Revolve Group Inc has the potential for sustained earnings growth.
Key Shareholders in Revolve Group Inc
Revolve Group Inc's shareholder base includes notable investment firms and individuals. HOTCHKIS & WILEY holds 199,900 shares, representing a 0.28% stake in the company. Renowned investor Jim Simons (Trades, Portfolio) owns 84,900 shares, accounting for 0.12% of the company's shares. Additionally, Paul Tudor Jones (Trades, Portfolio) has invested in 22,947 shares, making up 0.03% of the total shares. These stakeholders' involvement underscores the confidence in Revolve Group Inc's business model and future prospects.
Competitive Landscape
When compared to its closest competitors, Revolve Group Inc stands out with a higher market capitalization. Dada Nexus Ltd (DADA, Financial) has a market cap of $814.851 million, while Liquidity Services Inc (LQDT, Financial) is valued at $526.353 million. Revolve's larger market cap suggests a stronger position within the retail-cyclical industry, potentially offering a more stable investment opportunity.
Conclusion: Revolve Group Inc's Promising Outlook
In summary, Revolve Group Inc's recent stock performance and valuation indicate a company that is significantly undervalued, with a strong potential for growth. The analysis of the company's profitability and growth prospects, alongside the overview of significant shareholders, paints a picture of a robust business with a promising future. When juxtaposed with its competitors, Revolve's market position and financial health suggest it is well-equipped to continue its upward trajectory in the retail-cyclical industry.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
