Allbirds stock price forecast: BIRD’s future is in peril

May 24, 2024 07:45 PM AEST | By Invezz

Allbirds stock price forecast: BIRD’s future is in peril — Image source: Invezz

Allbird’s future is in peril

Allbirds, a once-popular ‘sustainable’ shoe company, has come under intense pressure in the past few years. Its attempts to expand in other areas like leggings, underwear, and puffer jackets have failed while its revenue has continued falling.

Allbirds’s annual revenue rose from $199 million in 2019 to a peak of $297 million in 2022. It then crashed to $254 million in 2023 and the trend is accelerating this year.

The company’s recent results showed that revenue tumbled by 27.6% in Q1 to over $39.3 million. While it gross margin improved, the company made a net loss of over $27.3 million. Its total annual losses in the past five years stand at over $300 million.

Allbirds has worked to transition its business. It has shed most of its other products and boosted its focus on its shoes and socks. While its new Wool Runner 2 shoe has been received well, it is unclear whether it will help to usher the company’s path to growth and profitability.

Allbirds expects that its annual revenue slowdown will continue this year. It expects that net revenue will be between $190 million and $210 million. For the second quarter, it sees its revenue coming in at between $35 million and $37 million, down from the $70 million it made a year earlier.

The other concern is whether Allbird’s balance sheet will support its transformation. It ended the first quarter with over $101 million in cash and short-term investments, down from $143 million a year earlier. For a company losing over $20 million in a quarter, this loss-making means that it might need to raise more cash this year.

Allbirds stock price forecast

BIRD chart by TradingView

Allbirds ended last year well as its stock jumped from the November low of $0.6400 to a high of $1.45 in December. This rebound happened as investors placed their bets that the company’s turnaround would do well.

This year, It turned down sharply as the company published weak Q4 and Q1 earnings in February and May. It has now crashed below the crucial support level at $0.6400 and the 50-day and 100-day moving averages.

Therefore, the outlook for the stock is bearish, with the next point to watch being the year-to-date low of $0.5337. A break below that level to watch will be the psychological point at $0.500. The only hope for Allbirds’s bulls is that it goes through a major short-squeeze as we saw with GameStop and AMC.

The post Allbirds stock price forecast: BIRD’s future is in peril appeared first on Invezz

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (“Kalkine Media, we or us”), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary.
The content published on Kalkine Media also includes feeds sourced from third-party providers. Kalkine does not assert any ownership rights over the content provided by these third-party sources. The inclusion of such feeds on the Website is for informational purposes only. Kalkine does not guarantee the accuracy, completeness, or reliability of the content obtained from third-party feeds. Furthermore, Kalkine Media shall not be held liable for any errors, omissions, or inaccuracies in the content obtained from third-party feeds, nor for any damages or losses arising from the use of such content.
Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyrighted to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have made reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.
This disclaimer is subject to change without notice. Users are advised to review this disclaimer periodically for any updates or modifications.