Fact based stock research
The Lovesac (NasdaqGM:LOVE)

US54738L1098

How to read the ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

The Lovesac stock research in summary

lovesac.com

ANALYSIS: With an Obermatt Combined Rank of 81 (better than 81% compared with investment alternatives), The Lovesac (Home Furnishings, USA) shares have much better financial characteristics than comparable stocks. Shares of The Lovesac are low in value (priced high) with a consolidated Value Rank of 20 (worse than 80% of alternatives) and show below-average growth (Growth Rank of 47) but are safely financed (Safety Rank of 80), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 81, is a strong buy recommendation based on The Lovesac's financial characteristics. As the company The Lovesac's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 20) and low growth (Obermatt Growth Rank of 47), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 80) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	20
Growth Rank	47
Safety Rank	80
Combined Rank	81

Country	USA
Industry	Home Furnishings
Index	NASDAQ
Size class	Medium

25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: The Lovesac

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	11	1	22	20
GROWTH
GROWTH	93	77	33	47
SAFETY
SAFETY	28	80	80	80
SENTIMENT
SENTIMENT	n/a	70	78	^new
360° VIEW
360° VIEW	n/a	37	85	^new

Most recent update of the stock research: 25-Apr-2024. Financial reporting date used for calculating ranks: 3-Feb-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better The Lovesac is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	11	1	22	20
GROWTH
GROWTH	93	77	33	47
SAFETY
SAFETY	28	80	80	80
COMBINED
COMBINED	33	81	81	81

Last update of combined financial performance: 6-Oct-2022. Stock analysis on combined financial performance: The higher the rank of The Lovesac the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 20 (worse than 80% compared with alternatives), The Lovesac shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for The Lovesac. Price-to-Sales (P/S) is 67, which means that the stock price compared with what market professionals expect for future sales is lower than 67% of comparable companies, indicating a good value concerning to The Lovesac's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 1, meaning that dividends are expected to be lower than for 99% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 59% of alternatives (only 41% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 71% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 20, is a sell recommendation based on The Lovesac's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in The Lovesac could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, The Lovesac looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	29	21	66	67
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	45	5	41	29
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	6	6	27	41
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	11	1	22	20

Last update of Value Rank: 25-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of The Lovesac; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 47 (better than 47% compared with alternatives), The Lovesac shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for The Lovesac. Sales Growth has a rank of 96 which means that currently, professionals expect the company to grow more than 96% of its competitors. Capital Growth is also above 19% of competitors with a rank of 67. But Profit Growth only has a rank of 19, which means that currently professionals expect the company to grow its profits less than 81% of its competitors. And Stock Returns have also been below average with a rank of only 19. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 47, is a hold recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	80	94	70	96
PROFIT GROWTH
PROFIT GROWTH	n/a	67	48	19
CAPITAL GROWTH
CAPITAL GROWTH	n/a	38	17	67
STOCK RETURNS
STOCK RETURNS	98	45	45	19
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	93	77	33	47

Last update of Growth Rank: 25-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of The Lovesac.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 80 (better than 80% compared with alternatives) for 2022, the company The Lovesac has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of The Lovesac is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for The Lovesac. Leverage is at 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors. Refinancing is at a rank of 66, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 66% of its competitors. Finally, Liquidity is also good at a rank of 89, which means that the company generates more profit to service its debt than 89% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 80 (better than 80% compared with alternatives), The Lovesac has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with The Lovesac but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	54	100	100	100
REFINANCING
REFINANCING	14	25	36	66
LIQUIDITY
LIQUIDITY	52	89	89	89
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	28	80	80	80

Last update of Safety Rank: 6-Oct-2022. Stock analysis on safety metrics: The higher the rank, the lower the leverage of The Lovesac and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	97	97	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	26	10	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	1	50	^new
MARKET PULSE
MARKET PULSE	n/a	90	91	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	70	78	^new

Last update of Sentiment Rank: 25-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for The Lovesac.
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