Author Topic: SFIX - Stitch Fix  (Read 20502 times)

SHDL

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Re: SFIX - Stitch Fix
« Reply #70 on: September 01, 2019, 01:03:53 PM »
Stitch Fix just acquired what I believe is an early stage startup called Finery:

https://www.yahoo.com/lifestyle/stitchfix-acquires-digital-wardrobe-startup-finery-201018873.html

Based on what I've seen I think the intention here was to acquire some IP/technology that will allow Stitch Fix to see (with permission, of course) what clothing items their members have purchased from other retailers online.  If so, this is a good move.

I'm not in SFIX anymore (I have a rule if I want to buy a stock but its expected return is worse than google I just buy google). However, often when a company is slowling down its growth (ie the C-suite knows it but its unclear for investors) they will buy another company to distract wall street.  I don't know if this is what management is semi conciously doing but I wouldn't be surprised.

That is something to watch out for.  My sense is that the target company in this case is pre-revenue, though I might be wrong.  Also Stitch Fix hasnít even bothered putting out a press release.  If distracting Wall Street is the objective they need to try harder...
« Last Edit: September 01, 2019, 01:22:23 PM by SHDL »


cameronfen

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Re: SFIX - Stitch Fix
« Reply #71 on: September 01, 2019, 02:02:26 PM »
Stitch Fix just acquired what I believe is an early stage startup called Finery:

https://www.yahoo.com/lifestyle/stitchfix-acquires-digital-wardrobe-startup-finery-201018873.html

Based on what I've seen I think the intention here was to acquire some IP/technology that will allow Stitch Fix to see (with permission, of course) what clothing items their members have purchased from other retailers online.  If so, this is a good move.

I'm not in SFIX anymore (I have a rule if I want to buy a stock but its expected return is worse than google I just buy google). However, often when a company is slowling down its growth (ie the C-suite knows it but its unclear for investors) they will buy another company to distract wall street.  I don't know if this is what management is semi conciously doing but I wouldn't be surprised.

That is something to watch out for.  My sense is that the target company in this case is pre-revenue, though I might be wrong.  Also Stitch Fix hasnít even bothered putting out a press release.  If distracting Wall Street is the objective they need to try harder...

Sure it might not be the case.  But often its subconcious.  Growth is slowing down so lets do something.  If there are plenty of reivestment oportunities for capital why buy someone else?  There does seem like there are synergies here, but I also get the impression they are fishing for opportunities to expand TAM in a way they wouldn't do if they didn't see the writing on the wall. 

SHDL

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Re: SFIX - Stitch Fix
« Reply #72 on: September 01, 2019, 02:54:07 PM »
If there are plenty of reivestment oportunities for capital why buy someone else? 

One good reason would be if they can buy some useful technology cheaper than it would cost to develop internally.  Or if there is a patent involved (which seems to be the case here).

But of course this is mostly speculation at this point.
« Last Edit: September 01, 2019, 03:26:31 PM by SHDL »