Stitch Fix (SFIX) Stock Forecast & Price Target

Stitch Fix Inc. anticipates sales between $1.28 billion and $1.33 billion for FY26, representing a year-over-year growth of 1% to 5%, indicating a stable revenue outlook. The company reported a 7.3% increase in total revenue for the first quarter, reaching $342 million, which surpassed consensus estimates and reflects a positive market response to its refreshed merchandise mix and expanded offerings. Additionally, an increase in average order value (AOV) by 7.6% year-over-year, along with positive trends in the women’s apparel category, supports the potential for sustained growth and improved financial performance moving forward.

Stitch Fix Inc. reported a decline in active clients, with a year-over-year decrease of 5.2% to 2.307 million, which reflects a concerning trend in customer retention. The company's gross margin also contracted significantly, decreasing by 180 basis points to 43.6%, falling short of both consensus expectations and prior forecasts. Furthermore, the adjusted EBITDA margin is projected to decrease to between 2.3% and 3.4%, indicating a negative outlook compared to last year's margin of 3.9%, which may exacerbate investor concerns regarding financial performance and growth sustainability.