William Blair analyst Phillip Blee has maintained their bullish stance on W stock, giving a Buy rating today.
Phillip Blee’s rating is based on Wayfair’s strategic restructuring efforts, which are expected to enhance the company’s financial performance. The recent layoffs and closure of the Austin technology center are part of a broader initiative to optimize operations following the completion of a significant technology re-platforming and cloud migration. This restructuring is anticipated to yield substantial cost savings, which management plans to reinvest into outsourced labor to maintain operational continuity.
Wayfair projects that these changes will lead to significant EBITDA growth, with estimated annual savings of $75 million and an incremental EBITDA increase of $40 million. These savings are expected to contribute to a 35 basis point improvement in margins, with a 20 basis point uplift anticipated in 2025. Consequently, Blee has adjusted the firm’s 2025 and 2026 EBITDA estimates upwards, reflecting confidence in Wayfair’s ability to achieve its financial targets and improve profitability.
In another report released today, Jefferies also upgraded the stock to a Buy with a $47.00 price target.