In a remarkable display of resilience and growth, TheRealReal Inc (NASDAQ:REAL)'s stock has soared to a 52-week high, reaching a price level of $4.66 USD. This milestone underscores a significant turnaround for the luxury consignment company, which has seen its stock value more than double over the past year, with an impressive 1-year change of 104.23%. Investors have shown increased confidence in TheRealReal's business model and growth strategy, propelling the stock to new heights and reflecting a robust recovery from its previous lows. The company's focus on authenticating and selling high-end goods has tapped into a growing market for sustainable luxury, attracting both eco-conscious consumers and those seeking value in the secondary market for luxury goods.
In other recent news, The RealReal has reported robust third-quarter results of 2024, showcasing a 6% year-over-year increase in Gross Merchandise Volume (GMV) to $433 million and an 11% rise in revenue to $148 million. The company also posted a positive adjusted EBITDA of $2.3 million, marking the second consecutive profitable quarter. The RealReal has raised its full-year guidance, projecting a Q4 GMV between $484 million and $500 million, and full-year revenue to be between $595 million and $602 million.
BTIG has adjusted its outlook on The RealReal, increasing the price target to $4.00 from the previous $3.50, while maintaining a Buy rating for the stock. This follows The RealReal's third-quarter results, which showed signs of positive momentum with the number of active buyers increasing by 8,000 quarter over quarter, reaching 389,000.
The RealReal also saw a 1.8% year-over-year rise in average order value to $522, and a take-rate increase to 38.6%, which is up 50 basis points year over year. The company's strategy to emphasize value by showing the original primary list price of items appears to be resonating with consumers. These recent developments suggest a positive trajectory for the company.
InvestingPro Insights
TheRealReal's recent stock performance aligns with the InvestingPro data, which shows a strong return of 99.55% over the last year and an impressive 122.89% year-to-date. The company's stock is currently trading near its 52-week high, with the price at 97.76% of its peak. This upward momentum is further evidenced by the significant 48.84% return over the last month and a 74.32% return over the last three months.
Despite the positive stock performance, InvestingPro Tips highlight some potential concerns. The company operates with a significant debt burden and may have trouble making interest payments on its debt. Additionally, analysts do not anticipate the company will be profitable this year, which is reflected in the negative P/E ratio of -5.89 for the last twelve months as of Q3 2024.
On a positive note, TheRealReal boasts impressive gross profit margins of 74.42%, which supports its business model of selling high-end luxury goods. This aligns with the company's focus on authenticating and selling premium items, as mentioned in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for TheRealReal, providing a deeper understanding of the company's financial health and market position.
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