Thoughts on Stitch Fix as a Long-Term Investment
I’ve been reading and thinking about Stitch Fix lately. I bought a few shares in March when the valuation was dirt-cheap, but it subsequently has moved to my “too-hard” pile when I sold everything in September. The company trades at a reasonable sales multiple (1.9x EV/sales LTM) when you consider: They are growing clients and revenue at ~10% a year even with COVID headwinds Gross margins sit at 45% and can expand at scale They have no debt and are cash flow positive You migh
Shopify Has Gotten Ridiculous
I sent out this tweet Friday morning: “$SHOP now with an EV/sales of 36, meaning like 5 years of 50% growth is already priced in. Why would anyone hold shares here?” $SHOP now with an EV/sales of 36, meaning like 5 years of 50% growth is already priced in. Why would anyone hold shares here? https://t.co/QRFEV8BGfP — Brett Schafer (@CCM_Brett) April 17, 2020 I expected some interesting responses, both bullish and bearish, to this question. What I did not expect was an onslaug
Time to Buy the Dip on Etsy?
The latest stock I’ve been reading about is Etsy. One, because we just recorded a podcast about it, and two, because of the post-earnings dip. They released the third-quarter report on October 30th and saw their stock drop viciously, likely because of gross-margin compression. Here are some highlights from the report: $198 million in revenue, up 31.6% YoY (28% discluding acquisition of Reverb) 2.59 million active sellers, up 27% YoY 44.8 million active buyers, up 20.7% YoY Gr
Etsy Crushes Again
Shares of Etsy, the “global marketplace for unique and creative goods,” were up as much as 10% in after-hours trading after another solid earnings report. The small-cap has killed the market over the last 12 months, up almost 200% vs. the S&P’s 1.2%. Etsy’s one year price chart. Crazy growth. I’ve had this stock on my radar for a while and, disappointingly, haven’t been able to pull the trigger yet. They are essentially the only e-commerce business that is Amazon proof, and I