Stitch Fix Stock Pops as Another Analyst Screams "Buy"

There's plenty of skepticism priced into outperforming SFIX

Jul 22, 2019 at 9:44 AM
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The shares of Stitch Fix Inc (NASDAQ:SFIX) have swung 3% higher this morning to trade at $27.70, after Stifel upgraded the online personal styling name to "buy" from "hold," saying recent weakness in the retail stock creates an "attractive entry point." The brokerage firm also sees growth opportunity in the U.K., and thinks new features like the "ability to buy individual items and the potential to add more items per fix could support further upside."

This is just the latest bull note to come down the pike for SFIX stock, with Goldman Sachs boosting its rating to "buy" earlier this month. However, the majority of analysts still maintain a tepid "hold" rating on Stitch Fix, which could keep the wind at the equity's back should more analysts upwardly revise their outlooks.

There's room for sentiment to improve in the options pits, too. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Stitch Fix stock's 10-day put/call volume ratio of 0.79 ranks in the 93rd annual percentile, meaning puts have been bought to open relative to calls at a quicker-than-usual clip.

Elsewhere, short sellers have been throwing in the towel on a stock that was up 57.4% heading into today's trading. The 10.45 million SFIX shares still controlled by shorts represents 27% of the security's available float, or 4.4 times the average daily pace of trading. A capitulation from some of the weaker bearish hands could create more upside for Stitch Fix.


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