SPWH seems to be tracking well. Like you said, biggest concern is sales and they have made it very clear that their main demographic (low-middle income men) aren't in a strong financial position right now. Im hoping the effect of brought forward demand from covid has worn off, and election tensions may offset the weak consumer. The company will also start comping well compared to last year. In the earnings calls they stated they missed Spring in a massive way last year, which isn't the case this time.
I think being FCF positive this year should at least re-rate it closer to book value, there shouldn't be a big risk of bankruptcy. $6 seems like a decent price target, with the intent to upgrade that if geopolitical tensions rise, or the consumer has an influx of gov cash (not likely until at least next year).
SPWH seems to be tracking well. Like you said, biggest concern is sales and they have made it very clear that their main demographic (low-middle income men) aren't in a strong financial position right now. Im hoping the effect of brought forward demand from covid has worn off, and election tensions may offset the weak consumer. The company will also start comping well compared to last year. In the earnings calls they stated they missed Spring in a massive way last year, which isn't the case this time.
I think being FCF positive this year should at least re-rate it closer to book value, there shouldn't be a big risk of bankruptcy. $6 seems like a decent price target, with the intent to upgrade that if geopolitical tensions rise, or the consumer has an influx of gov cash (not likely until at least next year).
Thanks Jake