Canaccord Genuity Reiterates Buy Rating on The Lovesac Co. (LOVE)

Canaccord Genuity analyst Maria Ripps reiterated a Buy rating and $30.00 price target on The Lovesac Co. (NASDAQ: LOVE).

The analyst commented: "Lovesac reported fiscal Q1 results that were modestly ahead of expectations, with revenue ~1% above consensus and adj. EBITDA broadly in line with the upper end of the guidance range. The business returned to growth after two quarters of modest y/y declines, while the category was estimated to decline 5% y/y, implying Lovesac continued to gain share. Showroom net sales accelerated to +18% y/y, the highest growth rate for the channel since fiscal 3Q24, in part reflecting a strategic decision by the company to lean into Showrooms to support product demos and personalized offers to customers. On 5/7, Lovesac officially launched EverCouch, with initial feedback "very positive," and the company plans to scale the product's presence to roughly 100 showrooms later this summer. Notably, Lovesac implemented some select price increases in May, its first price increase since 2023, and management indicated there may be opportunities for additional surgical price increases going forward. Q2 revenue guidance was broadly in line with expectations while profitability was below consensus, in part reflecting softer-than-expected GMs as the company works through China based inventory. That said, the company maintained its FY26 outlook for both revenue and profitability, which implies a few hundred bps of GM expansion in 2H26 as tariff related costs diminish and vendor concessions ramp. Despite the stable quarter and outlook, LOVE shares are under pressure on the print. With continued market share gains, an evolving product portfolio, a seemingly stabilizing global trade backdrop, and an undemanding valuation at less than 1x FY26 revenue and 4x adj. EBITDA, we view today's share move as a buying opportunity."

For an analyst ratings summary and ratings history on The Lovesac Co. click here. For more ratings news on The Lovesac Co. click here.

Shares of The Lovesac Co. closed at $16.82 yesterday.

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