The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines. On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. Read More: Penny Stocks - How to Profit Without Getting Scammed It is transforming the way modern women get. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that ’s writers disclose this fact and warn readers of the risks. Rent the Runway is an online e-commerce website that allows women to rent designer apparel and accessories. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day.
Investors may need to be convinced the company can achieve profitability before they step in, however. That’s below where it was trading yesterday, but above where it trades now. Rival fashion rental service Stitch Fix (NASDAQ: SFIX) cut 15% of its workforce in June, much like Rent the Runway.Īssuming Rent the Runway can get costs below revenues, it could draw a market cap equal to its expected annual revenue of $300 million. What is Rent the Runway Rent the Runway is transforming the way modern women get dressed and disrupting the 2.4 trillion fashion industry by pioneering dynamic ownership and enabling women to rent, subscribe to and purchase secondhand clothing. Rising interest rates and a falling market mean fast-growing companies can no longer rely on external capital to fuel growth. Inflation has caused people to cut unnecessary expenses, including high-end fashion. Rent the Runway is an eCommerce website specialized in renting luxury designer clothing and accessories for women. Other factors are in play with RENT stock, though. These plans allow for between 4 and 16 items per month. In addition to the job cuts, Rent the Runway is dumping an “unlimited” rental option in favor of plans ranging from $89 to $199 a month. Now, only 20% of rentals are work-related. Hyman says most of the company’s pre-pandemic revenue came from women looking for work clothes. Rent the Runway ended July with about 124,000 active subscribers, up 27% YOY but down from the 135,000 reported in Q1. The company has burned through $878 million in cash since its inception. It is transforming the way modern women get dressed - and in turn, disrupting the 1.7 trillion fashion industry - through the concept of renting over buying clothing.
The company announced job cuts despite beating revenue estimates by $3 million and earnings estimates by 12 cents per share.ĬEO Jenn Hyman says the job cuts are meant to get costs below revenue and show a profit. Rent the Runway is an online e-commerce website that allows women to rent designer apparel and accessories. Rent the Runway is just the latest clothing retailer to be hit by inflation and recession fears.
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