Rent the Runway tumbles on weak Q2 revenue forecast

Rent the Runway

08/06/2023 11:06

** Shares of apparel rental firm Rent the Runway  RENT.O 
down 11% at $2.50 before the bell 
    ** Company forecasts Q2 revenue below analysts expectations,
maintains annual revenue outlook
    ** Expects Q2 revenue between $77 mln and $79 mln, below
estimates of $81 mln, per Refinitiv IBES data
    ** RENT beat Q1 revenue estimates and posted a
smaller-than-expected loss 
    ** Telsey Advisory Group analysts say RENT has the
first-mover advantage in creating the world's largest "shared
closet" 
    ** Adds the company is well positioned to capitalize on
significant consumer trends that lean more towards "circular
consumption" and can drive long-term growth
    ** Jefferies cuts PT to $7 from $9 adding downside scenarios
could be if new subscriber count falls below expectations and an
increased marketing expense to support sales growth
    ** Eight of 10 brokerages rate the stock "buy" or higher and
two "hold"; with a median PT of $6 - Refinitiv
    ** Up to Wednesday's close, stock had fallen ~8% so far this
year

 (Reporting by Ananya Mariam Rajesh in Bengaluru)
 ((AnanyaMariam.Rajesh@thomsonreuters.com ; Twitter: https://twitter.com/AnanyaMariam))