Stitch Fix (SFIX) Stock Forecast & Price Target

Stitch Fix Inc. is projecting sales for FY26 between $1.28 billion and $1.33 billion, representing a year-over-year growth of 1% to 5%. The company reported a total revenue increase of 7.3% to $342 million for the first quarter, exceeding consensus expectations and highlighting its successful strategy of refreshing its merchandise mix and expanding offerings. Additionally, the rise in average order value (AOV) by 7.6% year-over-year, alongside a notable growth of 19% in women's apparel segments, indicates strong consumer engagement and demand for the company’s personalized styling services.

Stitch Fix Inc. reported a contraction in its adjusted EBITDA margin to 3.9% in the first quarter, down from 4.2% in the previous year, alongside a significant decline in active clients by 5.2% year-over-year, leading to a total of 2.307 million clients. The gross margin also decreased by 180 basis points to 43.6%, falling short of both consensus expectations and internal forecasts, contributing to a less favorable financial outlook. Furthermore, the company has adjusted its adjusted EBITDA margin guidance downward for the fiscal year, projecting a range of 2.3%-3.4%, reflecting a continued decline compared to last year's margins and indicating potential ongoing financial challenges.