Rent The Runway Shares Gain As Analysts See Huge Upside To Price Target

Several analyst firms initiated coverage on Rent The Runway Inc RENT with a huge upside to the company's price target. Rent the Runway is an e-commerce platform that allows users to rent, subscribe, or buy designer apparel and accessories.

• Goldman Sachs analyst Eric Sheridan initiated coverage with a Buy rating and $25 price target, implying a 54.32% upside. Sheridan noted as the post-pandemic world normalizes, Rent The Runway will be a key beneficiary of "return to work" as subscriber levels return to pre-pandemic levels.
• Barclays analyst Ross Sandler initiated coverage with an Overweight rating and $25 price target.
• The analyst viewed Rent as a "venture capital style investment," adding the company has "barely scratched the surface" of its potential subscriber base, and generated around $200 million in revenue per 100,000 subscribers.
• Credit Suisse analyst Michael Binetti initiated coverage of the company with an Outperform rating and $20 price target, implying a 23.5% upside.
• The analyst's survey indicated strong interest in trying rental subscriptions from women who want to add designer brands to their day-to-day wardrobe but can't afford to in a traditional owned-apparel model.
• Piper Sandler analyst Erinn Murphy initiated coverage of Rent The Runway with an Overweight rating and $22 price target, implying a 35.8% upside.
• Murphy told Rent the Runway plays into several secular investment themes, including the shift of apparel spending online, the move from ownership to access via subscription, and the sharing economy.
• Wells Fargo analyst Ike Boruchow initiated coverage with an Overweight rating and a $22 price target.
• While the re-commerce space has gained attention over the past few years, Boruchow sees Rent The Runway as an attractive opportunity to tap into the disruptive rental sub-sector of the apparel industry.
• Boruchow thinks the company will benefit from industry growth, company specific efforts to drive trial and repeat users via marketing and category expansion, and most notably, various margin drivers that can drive meaningful scale over time.
• KeyBanc analyst Edward Yruma initiated coverage with an Overweight rating and a $21 price target, suggesting a 29.6% upside. Yruma notes that KeyBanc's Key First Look Data points to near-term subscriber momentum.
• JMP Securities analyst Andrew Boone initiated coverage with an Outperform rating and $21 price target.
• Boone notes that the company is democratizing access to designer fashion with its "closet in the cloud" that gives customers a rotating wardrobe of 1.4M items across 18,000+ styles and 750+ brands.
• Morgan Stanley analyst Lauren Schenk initiated coverage with an Overweight rating and a $28 price target.
• Telsey Advisory analyst Dana Telsey initiated coverage with an Outperform rating and a $21 price target.
• Price Action: RENT shares are trading higher by 4.32% at $16.9 in premarket on the last check Monday.