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Unpacking Q1 Earnings: Lovesac (NASDAQ:LOVE) In The Context Of Other Home Furnishings Stocks


Jabin Bastian /
2024/07/01 5:22 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at Lovesac (NASDAQ:LOVE) and its peers.

A healthy housing market is good for furniture demand as more consumers are buying, renting, moving, and renovating. On the other hand, periods of economic weakness or high interest rates discourage home sales and can squelch demand. In addition, home furnishing companies must contend with shifting consumer preferences such as the growing propensity to buy goods online, including big things like mattresses and sofas that were once thought to be immune from e-commerce competition.

The 6 home furnishings stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 1.2%. while next quarter's revenue guidance was in line with consensus. Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and home furnishings stocks have had a rough stretch, with share prices down 12.4% on average since the previous earnings results.

Lovesac (NASDAQ:LOVE)

Known for its oversized, premium beanbags, Lovesac (NASDAQ:LOVE) is a specialty furniture brand selling modular furniture.

Lovesac reported revenues of $132.6 million, down 6.1% year on year, topping analysts' expectations by 3.6%. It was a very strong quarter for the company, with optimistic earnings guidance for the next quarter and full-year revenue guidance exceeding analysts' expectations.

Shawn Nelson, Chief Executive Officer, stated, “We are pleased to deliver first quarter performance inline to slightly above the high end of our expectations. Our results reflect continued outperformance compared to the industry and demonstrate our commitment to executing against our objectives. We believe through our omni-channel infinity flywheel, designed for life platform and advantaged supply chain we are well positioned to continue to deliver results and capitalize on the tremendous opportunity still ahead. With the recent launch of our PillowSac Accent Chair we are continuing to expand our offering and see opportunity to further widen the aperture with exciting innovative launches yet to come.”

Lovesac Total Revenue

Lovesac pulled off the highest full-year guidance raise of the whole group. The stock is down 12.1% since the results and currently trades at $22.84.

Is now the time to buy Lovesac? Access our full analysis of the earnings results here, it's free.

Best Q1: La-Z-Boy (NYSE:LZB)

The prized possession of every mancave, La-Z-Boy (NYSE:LZB) is a furniture company specializing in recliners, sofas, and seats.

La-Z-Boy reported revenues of $553.5 million, down 1.4% year on year, outperforming analysts' expectations by 7.2%. It was a stunning quarter for the company, with an impressive beat of analysts' earnings and operating margin estimates.

La-Z-Boy Total Revenue

La-Z-Boy scored the biggest analyst estimates beat among its peers. The stock is up 9.4% since the results and currently trades at $37.28.

Is now the time to buy La-Z-Boy? Access our full analysis of the earnings results here, it's free.

Weakest Q1: Purple (NASDAQ:PRPL)

Founded by two brothers, Purple (NASDAQ:PRPL) creates sleep and home comfort products such as mattresses, pillows, and bedding accessories.

Purple reported revenues of $120 million, up 12.5% year on year, falling short of analysts' expectations by 1.7%. It was a weak quarter for the company, with a miss of analysts' earnings and revenue estimates.

Purple scored the fastest revenue growth in the group. The stock is down 32.5% since the results and currently trades at $1.14.

Read our full analysis of Purple's results here.

Leggett & Platt (NYSE:LEG)

Founded in 1883, Leggett & Platt (NYSE:LEG) is a diversified manufacturer making products for various industries.

Leggett & Platt reported revenues of $1.10 billion, down 9.6% year on year, falling short of analysts' expectations by 2%. It was a weaker quarter for the company, with a miss of analysts' revenue estimates and underwhelming earnings guidance for the full year.

Leggett & Platt had the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update among its peers. The stock is down 36.5% since the results and currently trades at $11.48.

Read our full, actionable report on Leggett & Platt here, it's free.

Tempur Sealy (NYSE:TPX)

Established through the merger of Tempur-Pedic and Sealy in 2012, Tempur Sealy (NYSE:TPX) is a bedding manufacturer known for its innovative memory foam mattresses and sleep products

Tempur Sealy reported revenues of $1.19 billion, down 1.5% year on year, falling short of analysts' expectations by 1.3%. It was a slower quarter for the company, with a miss of analysts' operating margin and revenue estimates.

The stock is down 5.6% since the results and currently trades at $47.34.

Read our full, actionable report on Tempur Sealy here, it's free.

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