Hedgeye CEO Keith McCullough is adding Warby Parker (WRBY) to the short side of Investing Ideas. Below is a brief note.
What makes stocks bounce to lower-highs in bear markets? Lots of things. And, yes, the Russell and Small Caps are in a #Quad4 bear market...
This Barron's bounce in Warby Parker (WRBY) is as old as ye Olde Wall itself.
On the fundamentals, subscribers to real research (not Barron's journo articles) can read content like this from Retail analyst Brian McGough's Research Pro subscription:
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Warby Parker – WRBY, New Short Idea. (Note: We’re co-covering this one with Tom Tobin and our Healthcare research team.) Warby Parker, the trendy glasses store, came public via Direct Listing at $40/share back on Sep. 29th, traded up to about $55 and is now back in the $45 range. While we buy-in to the top line growth opportunity for WRBY in the highly fragmented glasses space, we think that the profitability expectations laid out in the S-1 and company roadshow are far too aggressive. The name currently gets a disruptor-esque 8x EV/Sales multiple... |
Sell the bounce to lower-highs. It's #Quad4,
KM