Northland initiated coverage on Stitch Fix (NASDAQ:SFIX) with an outperform rating and a $5.00 price target, citing turnaround progress and expected return to client growth. The stock trades at $3.53, suggesting upside.
Stitch Fix is nearing an inflection point after four quarters of adjusted revenue growth and improved revenue-per-active-client. Revenue grew 3.7% over the last twelve months to $1.32 billion, with a gross profit margin of 44%. Active clients are expected to return to growth in fiscal 2027.
Northland notes Stitch Fix is transitioning from a multi-year transformation to a sustainable growth phase. CEO Matt Baer, who joined in mid-2023, repositioned the company as a flexible, recurring personalized shopping service. New offerings include themed fixes and larger box sizes, improving retention.
In recent news, Stitch Fix reported Q2 fiscal 2026 results beating estimates: EPS of -$0.02 vs. -$0.07 expected, revenue of $341.3M vs. $334.74M. The company also repurchased 4.5 million shares for $15 million.
