1 Consumer Stock on Our Buy List and 2 We Question
Retailers are overhauling their operations as technology redefines the shopping experience. One initiative that has proven effective is the expansion into e-commerce, which has helped the industry sustain its same-store sales growth and keep pace with the S&P 500’s 10.1% return over the past six months.
Although these companies have produced results lately, investors must be mindful as many companies in this space face structural headwinds. Keeping that in mind, here is one resilient consumer stock at the top of our shopping list and two that may face trouble.
Two Consumer Retail Stocks to Sell:
Torrid (CURV)
Market Cap: $110.1 million
Promoting a message of body positivity and inclusiveness, Torrid Holdings (NYSE:CURV) is a plus-size women’s apparel and accessories retailer.
Why Are We Out on CURV?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
- Earnings per share decreased by more than its revenue over the last three years, showing each sale was less profitable
- High net-debt-to-EBITDA ratio of 5× could force the company to raise capital at unfavorable terms if market conditions deteriorate
At $1.11 per share, Torrid trades at 7.7x forward EV-to-EBITDA. If you’re considering CURV for your portfolio, see our FREE research report to learn more.
Tilly's (TLYS)
Market Cap: $60.03 million
With an emphasis on skate and surf culture, Tilly’s (NYSE:TLYS) is a specialty retailer that sells clothing, footwear, and accessories geared towards fashion-forward teens and young adults.
Why Do We Avoid TLYS?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Cash burn makes us question whether it can achieve sustainable long-term growth
- EBITDA losses may force it to accept punitive lending terms or high-cost debt
Tilly’s stock price of $1.97 implies a valuation ratio of 0.1x forward price-to-sales. Dive into our free research report to see why there are better opportunities than TLYS.
One Consumer Retail Stock to Buy:
Warby Parker (WRBY)
Market Cap: $2.84 billion
Founded in 2010, Warby Parker (NYSE:WRBY) designs, manufactures, and sells eyewear, including prescription glasses, sunglasses, and contact lenses, through its e-commerce platform and physical retail locations.
Why Is WRBY a Top Pick?
- Fast expansion of new stores indicates an aggressive approach to attacking untapped market opportunities
- Operating margin improvement of 4.8 percentage points over the last year demonstrates its ability to scale efficiently
- Earnings per share grew by 72.3% annually over the last three years and trumped its peers
Warby Parker is trading at $23.53 per share, or 50x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.