On Wednesday, Piper Sandler adjusted its stock price target for Beyond Inc. (NYSE:BYON), a company which operates three primary e-commerce websites, reducing it to $17.00 from the previous $26.00. Despite this change, the firm maintained a Neutral rating on the stock.
The adjustment follows Beyond Inc.'s recent quarterly results and earnings call, which indicated that significant time and patience will be required for the management to strike the right balance between sales growth and profitability.
The company's efforts to rebuild its key websites—Bed Bath & Beyond, Overstock (NYSE:BYON), and Zulily—were highlighted as areas of particular concern, with notable uncertainty surrounding the timelines for the Overstock and Zulily re-launches to positively impact sales and EBITDA.
The analyst's commentary noted that the home furnishings industry is currently at or near the bottom of its cycle, suggesting potential for sales growth as the market conditions improve over the next two years.
Still, the ambitious revenue targets set by Beyond Inc., which are a part of the company's incentive compensation plan, were deemed unattainable based on current projections. The targets include reaching $2.7 billion in revenue by 2025, a figure that stands in stark contrast to Piper Sandler's revised estimate of $1.7 billion.
The report underscored the challenges faced by Beyond Inc. as it navigates an industry downturn and strives to reposition its brand for future growth. The lowered stock price target reflects the firm's revised sales expectations for 2024, which are now pegged at 0.5 times the estimated sales for that year.
InvestingPro Insights
In light of Piper Sandler's recent price target adjustment for Beyond Inc. (NYSE:BYON), InvestingPro offers additional insights that may be crucial for investors considering this stock. Despite the challenging industry conditions and the company's ambitious revenue targets, Beyond Inc. holds more cash than debt, which could provide some financial flexibility in executing its turnaround strategy.
Moreover, the stock's current status in oversold territory according to the RSI may interest value investors looking for potential entry points.
From a valuation standpoint, Beyond Inc. is trading at a low revenue valuation multiple, which could appeal to those who believe in the company's long-term potential despite recent setbacks. However, it's worth noting that the company has not been profitable over the last twelve months, and analysts do not anticipate it will be profitable this year, which could be a cause for concern.
InvestingPro data shows that Beyond Inc. has a market capitalization of $755.51 million and a price/book ratio of 2.61 as of the last twelve months leading up to Q1 2024. Revenue growth has been negative at -11.96% over the same period, reflecting some of the challenges highlighted by Piper Sandler.
Given these metrics, investors may want to consider the additional 13 InvestingPro Tips available on https://www.investing.com/pro/BYON for a more comprehensive analysis. For those interested in an InvestingPro subscription, use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.