W

Wayfair Inc

Consumer, TMT


Presented:12/06/2018
Price:$111.02
Cap:$10.26B
Current Price:$53.14
Cap:$6.56B

Presented

Date12/06/2018
Price$111.02
Market Cap$10.26B
Ent Value$13.27B
P/E RatioN/A
Book ValueN/A
Div Yield0%
Shares O/S92.38M
Ave Daily Vol2,104,037
Short Int24.35%

Current

Price$53.14
Market Cap$6.56B
Wayfair, Inc. engages in an online home furnishing store. It offers a selection of home furnishings and decor across all styles and price points. It operates through the U.S. and International segments. The U.S. segment consists of amounts earned through product sales through the Company's five distinct sites in the U.S. and through websites operated by third parties in the U.S. The International segment is composed of earnings through products sales in international sites. The company was founded by Steven K. Conine and Niraj S. Shah in May 2002 and is headquartered in Boston, MA.

Publicly traded companies mentioned herein: Amazon.com Inc (AMZN), Netflix Inc (NFLX), Otto GmbH & Co KG (private with public debt), Target Corp (TGT), Walmart Inc (WMT), Wayfair Inc (W), Williams-Sonoma Inc (WSM)

Highlights

The presenter is long shares of Wayfair Inc (W), the online furniture/home goods retailer that operates more like a platform/ logistics provider. Disappointing Q3 earnings results caused the stock to trade down ~16%, leaving the stock off ~30% from its 52-week high. Despite this and other concerns, the presenter is optimistic about top-line growth and bottom-line improvement and thinks the current valuation (1.5x trailing and forward EV/Revenue) is an attractive entry point. Running a DCF model around various growth scenarios justifies a “significantly higher” stock price, and worst- and best-case multiples of 0.8x and 2x trailing revenue leave a risk/ reward of ~$70 on the downside and $170 - $195 on the upside.

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Idea Discussion

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