Shares of Figs sank in Friday after the maker of fashionable medical scrubs cut its revenue forecast for 2022.
Figs (ticker: FIGS) said it expects net revenue of $510 million to $530 million, down from its previous outlook of $550 million to $560 million. The company said the updated forecast reflects “supply-chain challenges and broader macroeconomic factors, including high inflation and shifts in consumer spending patterns.”
The company also said gross margin in 2022 was expected in the range of 67% to 68%, compared with the previous outlook of more than 70%, “primarily due to a significant increase in the company’s use of air freight to help mitigate supply-chain challenges.”
The stock was falling 25.8% to $9.53 on Friday. The shares have fallen more than 65% year to date. Figs went public in May 2021 at $22.
For the first quarter, Figs posted adjusted earnings of 5 cents a share on revenue of $110.1 million. Both metrics missed analysts’ forecasts.
Analysts at Cowen lowered their price target on Figs to $11 from $24. They have a Market Perform rating on the stock.
“Supply-chain chaos led to significant disruption in product flows, and shifting of the launch calendar,” Cowen said in a research note. “Our concerns are on the premium valuation and lofty consensus estimates.” The analysts reduced their 2022 earnings estimates for Figs to 16 cents a share, about 10 cents below consensus.
Coming into the earnings report, analysts surveyed by FactSet had an overweight rating on the stock and an average price target of $30.73.
Write to Joe Woelfel at [email protected]
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