Canaccord Lowers Price Target for Lovesac Despite Strong Q2 Results
On September 10, Canaccord lowered its price target for The Lovesac Company (NASDAQ:LOVE) from $22 to $20 but kept a Buy rating. This followed the company's second-quarter fiscal 2027 results released on August 2, which were in line with expectations and included unexpected IEEPA tariff refunds that boosted gross margins and earnings above consensus estimates. Lovesac reported net sales up slightly by 0.4% year-over-year due to new showrooms but faced a decline in omni-channel comparable sales and the closure of Best Buy shop-in-shop locations. The company's net income improved significantly, from a $6.7 million loss last year to $7.4 million this quarter, driven largely by tariff refunds rather than core business performance. Despite strong demand for premium configurations priced above $6,000 and double-digit growth in that segment, the company revised its full-year outlook downward due to product launch delays and a challenging promotional environment. Analysts remain optimistic with an average 12-month price target of $20 implying about 43.78% upside from current levels.
Topics: Canaccord Genuity Earnings Results Gross Margin Lovesac Stock Rating