Online fashion resale marketplace ThredUp (NASDAQ:TDUP) will be announcing earnings results tomorrow afternoon. Here’s what investors should know.
ThredUp beat analysts’ revenue expectations by 4.1% last quarter, reporting revenues of $73.02 million, down 11% year on year. It was a satisfactory quarter for the company, with an impressive beat of analysts’ EBITDA estimates but a miss of analysts’ orders estimates. It reported 1.55 million orders, down 13.9% year on year.
Is ThredUp a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting ThredUp’s revenue to decline 15.3% year on year to $68.93 million, a reversal from the 14.1% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. ThredUp has missed Wall Street’s revenue estimates six times over the last two years.
Looking at ThredUp’s peers in the apparel and accessories segment, some have already reported their Q4 results, giving us a hint as to what we can expect. VF Corp delivered year-on-year revenue growth of 1.9%, beating analysts’ expectations by 1.2%, and Under Armour reported a revenue decline of 5.7%, topping estimates by 4.5%. VF Corp traded up 1.4% following the results while Under Armour was down 11.7%.
Read our full analysis of VF Corp’s results here and Under Armour’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump’s triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the apparel and accessories stocks have shown solid performance, the group has generally underperformed, with share prices down 3.3% on average over the last month. ThredUp is down 4.7% during the same time and is heading into earnings with an average analyst price target of $3 (compared to the current share price of $2.25).
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