One-glance verdict
Within fair range
$16.55 our estimate vs market $15.31
Wall Street consensus: $23.17 (40.0% higher than our fair-value estimate)
7% below our estimate
Fundamentals snapshot
The Lovesac Company
LOVE · NGM · Consumer Cyclical · Furnishings, Fixtures & Appliances
Current price
$15.31
52-week range
$10.33 - $19.25
Market cap
$220.82M
Balance sheet
Watch
45.84x Strong cushion
Net debt $122.22M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 0.1% last year.
- Reward Returns 8.8% on equity, ahead of 80% of its peers.
- Risk Operating margin compressed from 5.7% to -5.6% over 3 years.
- Risk Insider ownership is only 5.5% (peer median: 13.1%).
What this company does
The Lovesac Company
Lovesac makes and sells comfy, modular furniture like sectionals and beanbag chairs, with their main money coming from selling these furniture pieces directly to customers online and in their stores. This matters because it shows how much people like their unique furniture style and how well they can reach customers.
How the company got here
Lovesac started in 1995 with a simple idea: oversized, foam-filled beanbag chairs, affectionately called "Sacs." The founder, Shawn Nelson, began by making these for friends, but soon the demand grew, leading to the opening of mall-based stores and kiosks. This early focus on unique, comfortable seating helped build brand recognition. A significant turning point came in 2006 when the company filed for Chapter 11 bankruptcy protection, a process that forced a strategic reset and a more disciplined approach to growth. Later that year, Lovesac introduced its Sactionals, a modular couch system, which would become its flagship product and a major driver of its success. The company went public in 2018, marking another key milestone in its journey from a small startup to a recognized furniture brand.
What it actually does
Lovesac designs, manufactures, and sells furniture, with a particular focus on modular and adaptable pieces. Their core philosophy, "Designed for Life," emphasizes creating products that are durable, customizable, and can evolve with a customer's changing needs. They offer a range of seating options, from their signature Sacs to highly configurable Sactionals, along with various accessories to enhance comfort and functionality. Lovesac sells its products directly to consumers through a mix of online channels and physical showrooms, aiming to control the customer experience and brand presentation.
Sactionals
Sactionals are Lovesac's main product line and the biggest contributor to its revenue, making up the vast majority of sales. These are not just ordinary couches; they are modular seating systems built from individual "Seats" and "Sides" that can be arranged in countless configurations. This means a customer can start with a small loveseat and expand it into a large sectional, or even reconfigure it for a different room layout. The system also features interchangeable, washable covers, allowing for easy updates to style or cleaning. This adaptability is key to Lovesac's "Designed for Life" philosophy, offering a long-term furniture solution.
Sacs
Sacs are the original product that launched Lovesac, and they remain a significant part of the business. These are essentially oversized, comfortable beanbag chairs filled with a proprietary foam mixture, offering a more casual and relaxed seating option. While they represent a smaller portion of overall revenue compared to Sactionals, Sacs are important for brand identity and appeal to customers looking for unique, comfortable pieces for bedrooms, media rooms, or other casual spaces. Lovesac also offers accessories for Sacs, like blankets and covers, to enhance their functionality and style.
Accessories and StealthTech
Beyond their main seating products, Lovesac offers a variety of accessories designed to complement their Sactionals and Sacs. These include items like drink holders, decorative pillows, ottomans, and blankets, which add convenience and personalization to the furniture. A more technologically advanced offering is StealthTech, an integrated home theater system that can be incorporated into Sactionals configurations, providing an immersive audio experience. This segment represents a smaller but innovative part of Lovesac's business, aiming to blend comfort with modern technology.
What management is betting on now
Lovesac's management is focused on expanding the Sactionals ecosystem and reinforcing its "Designed for Life" philosophy. They are prioritizing disciplined growth, emphasizing product innovation within their core offerings, and enhancing the customer experience across their omnichannel sales model. A key strategic initiative is maintaining brand clarity by focusing on their adaptable furniture solutions rather than diversifying into a broad range of furniture types. They are also committed to sustainability, aiming for zero waste and net-zero emissions across their supply chain by 2040, including repurposing plastic bottles into their fabrics. This long-term vision aims to build a beloved brand while creating a sustainable future.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q3
$-6.59M
FY2025 Q4
$38.74M
FY2026 Q1
$-49.95M
FY2026 Q2
$7.83M
FY2026 Q3
$-10.18M
FY2026 Q4
$78.50M
FY2027 Q1
$-40.39M
FY2027 Q2
$17.36M
Revenue
$161.25M
Net income
$7.43M
Diluted EPS
0.51
Operating cash flow
$23.93M
Free cash flow
$17.36M
Fetching…
Sources
Revenue
$138.20M
Net income
$-11.09M
Diluted EPS
-0.76
Operating cash flow
$-35.36M
Free cash flow
$-40.39M
Fetching…
Sources
Revenue
$248.05M
Net income
$32.11M
Diluted EPS
2.18
Operating cash flow
$83.42M
Free cash flow
$78.50M
Fetching…
Sources
Revenue
$150.17M
Net income
$-10.55M
Diluted EPS
-0.72
Operating cash flow
$-4.88M
Free cash flow
$-10.18M
Fetching…
Sources
Revenue
$160.53M
Net income
$-6.65M
Diluted EPS
-0.45
Operating cash flow
$12.16M
Free cash flow
$7.83M
Fetching…
Sources
Revenue
$138.37M
Net income
$-10.84M
Diluted EPS
-0.73
Operating cash flow
$-41.38M
Free cash flow
$-49.95M
Fetching…
Sources
Revenue
$241.49M
Net income
$35.31M
Diluted EPS
2.22
Operating cash flow
$44.02M
Free cash flow
$38.74M
Fetching…
Sources
Revenue
$149.91M
Net income
$-4.93M
Diluted EPS
-0.32
Operating cash flow
$-4.21M
Free cash flow
$-6.59M
Fetching…
Sources
Is it cheap or expensive?
Fair value $16.55 vs current price $15.31
Wall Street consensus is the average analyst price target: $23.17 (40.0% higher than our fair-value estimate).
Our most-likely fair value is $16.55 a share — about 8.1% away from today's price of $15.31, so the stock currently looks fairly priced.
Is it drowning in debt?
Watch
Net debt $122.2M. Interest coverage 45.8x.
Net debt
$122.22M
Interest coverage
45.84x
The Lovesac Company's profit covers its interest bill about 45.8 times over. which is stronger than most peers shown here and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Watch
Worse cushion
Baseline
Better cushion
LOVE
BASELINE
The Lovesac Company
Total debt $191.02M Interest coverage 45.84x This is the baseline the peer rows are being compared against.
Total debt $82.71M Interest coverage 160.10x +249% vs LOVE Carries about 3.5x more debt cushion than LOVE.
Total debt $230.71M Interest coverage 4.13x -91% vs LOVE Carries about 11.1x less debt cushion than LOVE.
Total debt $120.69M Interest coverage 203.19x +343% vs LOVE Carries about 4.4x more debt cushion than LOVE.
Total debt $23.95M Interest coverage -1.16x -100% vs LOVE This peer has almost no interest-payment cushion compared with LOVE.
Total debt $215.18M Interest coverage -1.10x -100% vs LOVE This peer has almost no interest-payment cushion compared with LOVE.
What you should know
The case for and against LOVE
3 Rewards
2 Risks
Rewards
-
Revenue grew 0.1% last year.
-
Returns 8.8% on equity, ahead of 80% of its peers.
-
Free cash flow was positive in 5/10 years.
Risks
-
Operating margin compressed from 5.7% to -5.6% over 3 years.
-
Insider ownership is only 5.5% (peer median: 13.1%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
12.55x
Forward P/E
6.69x
P/B
1.05x
P/S
0.32x
EV/EBITDA
19.81x
PEG ratio
0.36x
Profitability
How much profit each dollar creates
Gross margin
56.0%
Operating margin
-5.6%
Net margin
2.6%
ROE
8.8%
ROA
0.1%
Health
Liquidity and balance-sheet strength
Debt / equity
0.91x
Current ratio
1.47x
Quick ratio
0.53x
Total debt
$191.02M
Total cash
$68.80M
Growth
How the business has been compounding
Revenue TTM
$697.65M
Revenue 5Y CAGR
8.8%
EPS TTM
1.22
EPS 5Y CAGR
-45.9%
Cash flow
How much cash the business throws off
Operating CF TTM
$67.11M
Free CF TTM
$26.19M
FCF margin
3.8%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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