Revolve Group Inc (RVLV, Financial), a prominent player in the e-commerce retail space, has experienced a notable fluctuation in its stock price over recent periods. With a current market capitalization of $1.54 billion, the stock price stands at $21.69. Over the past week, RVLV has seen a decline of 4.76%, yet this short-term loss is contrasted by a significant gain of 14.56% over the past three months. According to GuruFocus's valuation metrics, the current GF Value of RVLV is $29.45, suggesting that the stock is modestly undervalued compared to its past GF Value of $33.68, which indicated a significantly undervalued status.
Revolve Group Inc: A Digital Fashion Frontier
Revolve Group Inc operates within the cyclical retail industry, specializing in women's fashion and beauty products. The company has carved out a niche in mobile commerce and influencer marketing, targeting the next-generation customer with an aspirational yet accessible luxury brand portfolio. In 2023, Revolve reported net sales of $1.1 billion, positioning it just outside the top 30 apparel retailers in the U.S. The company's strategy includes a mix of private-label offerings and a curated selection of products from emerging fashion brands, which has contributed to its robust top-line growth as the industry shifts increasingly towards digital channels.
Assessing Revolve's Profitability
Revolve's Profitability Rank stands at 6/10, reflecting a solid position within its industry. The company's operating margin is 2.07%, outperforming 40.74% of its industry peers. Its return on equity (ROE) is 7.17%, surpassing 54.52% of competitors, while the return on assets (ROA) at 4.58% and return on invested capital (ROIC) at 6.17% are better than 64.78% and 60.72% of industry peers, respectively. These figures demonstrate Revolve's ability to generate profits and manage its assets effectively, with a history of profitability spanning seven out of the past ten years.
Growth Trajectory of Revolve Group
The company's Growth Rank is an impressive 8/10. Revolve's 3-Year Revenue Growth Rate per Share stands at 21.70%, which is higher than 83.99% of its industry counterparts. However, the 5-Year Revenue Growth Rate per Share shows a decrease of 2.80%. Looking ahead, the Total Revenue Growth Rate (Future 3Y To 5Y Est) is projected at 9.59%, indicating a strong growth potential. The 3-Year EPS without NRI Growth Rate has decreased by 21.60%, but the future looks bright with an estimated EPS Growth Rate (Future 3Y To 5Y Est) of 42.05%, outperforming 90.48% of industry peers.
Notable Investment Holders in Revolve
Revolve Group has attracted the attention of several prominent investors. HOTCHKIS & WILEY holds 199,400 shares, representing 0.28% of the company's shares. Paul Tudor Jones (Trades, Portfolio) follows closely with 180,285 shares, accounting for 0.25% of the shares, and Jim Simons (Trades, Portfolio) holds 152,900 shares, or 0.21% of the company's shares. These holdings reflect the confidence of seasoned investors in Revolve's business model and future prospects.
Competitive Landscape
In comparison to its competitors, Revolve Group Inc stands out with a higher market capitalization. Dada Nexus Ltd (DADA, Financial) has a market cap of $630.135 million, while Liquidity Services Inc (LQDT, Financial) is valued at $550.797 million. This indicates Revolve's stronger market position within the retail - cyclical industry.
Conclusion: Revolve Group's Market Position and Outlook
In summary, Revolve Group Inc's recent stock performance reflects a company that is currently modestly undervalued according to the GF Value, with a strong growth trajectory and solid profitability metrics. The company's strategic focus on digital channels, influencer marketing, and a unique product mix has positioned it well within the competitive landscape. The investment positions of notable holders further underscore the potential that investors see in Revolve. As the retail industry continues to evolve, Revolve Group Inc appears poised to capitalize on its strengths and continue its growth in the digital fashion space.
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.
