Stitch Fix's Appointment Of Former Macy's Exec Expected To Boost Digital Growth, Analyst Predicts

Telsey Advisory Group analyst Dana Telsey reiterated a Market Perform rating on Stitch Fix, Inc. SFIX with a price target of $5. 

Stitch Fix recently appointed Matt Baer as its Chief Executive Officer and a member of the Board of Directors, effective June 26, 2023. Previously, Baer was Chief Customer & Digital Officer at Macy's Inc M, responsible for the growth and strategic long-term vision of Macy's and Bloomingdale's digital businesses.

The analyst notes that Baer brings significant digital and merchandising experience to aid SFIX's growth trajectory.

The analyst believes Baer's digital experience, particularly his track record at Macy's, should serve him well as he navigates a challenging macro and operating environment.

Also Read: Shifting Consumer Trends Favor Stitch Fix Despite Broader Macroeconomic Challenges: Analyst

While management transitions carry some risk, especially taking the reins from the company's founder, Baer appears well suited to run Stitch Fix, the analyst adds.

While at Macy's, he grew the digital business by over 30% (from FY19 to FY22), the analyst says. Baer launched numerous initiatives, including the third-party Marketplace, Macy's Media Network, a redesigned macys.com, and its mobile app. 

Baer has demonstrated the ability to outperform the market while driving online growth and innovation at Macy's and Bloomingdale's in recent

years.

The analyst flags that SFIX is facing the ongoing, broader macro environment challenges that continue to pressure consumers. 

The analyst adds that the company's visibility to ultimate subscriber growth and profitability potential remains challenging as the company continues to refine the platform and the offering.

Price Action: SFIX shares are trading lower by 3.5% to $4.04 on the last check Thursday.