The RealReal (REAL) Stock Forecast & Price Target

The RealReal has demonstrated strong financial performance, with active buyers increasing by 23,000 quarter-over-quarter to exceed 1 million, marking an all-time quarterly high. In 2024, the company reported a notable 17% revenue growth, driven by a slight compression in the take rate as it shifted towards higher-value items, while its adjusted EBITDA margin expanded by approximately 380 basis points year-over-year to reach 5.4%. Furthermore, with operating expenses leveraged by about 470 basis points year-over-year, the path to increasing free cash flow and a healthier balance sheet appears to be supported by continued growth in consignors and improved productivity within the sales team.

The RealReal faces a potential decline in sales, with estimates for 2026 projected to be 10%-15% lower than current forecasts due to challenges in expanding its consignor base through marketing and conversion strategies. The company is also contending with a declining allure of luxury in recent years, characterized by a lack of innovation and extreme price increases, which have shifted consumer interest toward secondhand platforms. Furthermore, macroeconomic uncertainties and the risks associated with counterfeit goods could adversely affect consumer discretionary spending and damage The RealReal's reputation, leading to a detrimental impact on its ability to maintain relationships with consignors, buyers, and brand partners.