Solo Brands Inc Class A (DTC) AI Stock Analysis

• Market Cap: $19.15M
• Dividend Yield: N/A
• Average Volume (3M): 1.13M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.85
• Revenue Growth: -8.13%
• EPS Growth: 0.04%
• Country: US
• Employees: 526
• Sector: Consumer Cyclical
• Sector Strength: 51
• Industry: Specialty Retail
• EPS (TTM): -1.94
• Shares Outstanding: 59,186,520
• 10 Day Avg. Volume: 2,111,799
• 30 Day Avg. Volume: 1,128,109
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.04
• Price to Cash Flow (P/CF): 0.40
• P/FCF Ratio: 0.30
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1.00
• Price Target Upside: 455.56% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

Solo Brands Inc's overall stock score of 41 reflects significant financial and operational challenges. The company's declining revenues, worsening margins, and liquidity issues are major concerns, as indicated by the financial performance score. Technical analysis supports a bearish trend, and the negative valuation metrics underscore the stock's struggles. While the earnings call highlights strategic initiatives to address these issues, uncertainties in financial compliance and paused guidance add to the cautious outlook.

Positive Factors

Brand Value

Analyst believes the Solo Stove and Chubbies brands are collectively worth significantly more than the market is currently valuing the company.

Product Development and Expansion

The company is actively filling its product development pipeline to release new products and expand its core business in the coming years.

Negative Factors

Investor Confidence

The company has lost significant investor confidence and may function better either as a private company or as part of a larger entity.

Leadership Instability

The cancellation of Solo Stove's rewards program, a second CEO change in 13 months, and a lack of a Q4 pre-announcement contribute to the company's instability.

Stock Delisting Risk

Solo Brands received notice from the NYSE that it was not in compliance with continued listing standards due to the closing price of its stock being under $1 per share over a consecutive 30-day trading period.

Solo Brands Inc Class A Business Overview & Revenue Model

Company Description

Solo Brands, Inc. operates a direct-to-consumer platform that offers outdoor lifestyle branded products in the United States. The company provides camp stoves under the Solo Stove Lite brand name; fire pits under the Solo Stove brand name; grills, cook tops, and tools; kayaks under the Oru brand name; paddle boards under the ISLE brand name; and storage solutions for fire pits, firewood, and other accessories. It also offers swim trunks, casual shorts, sport products, polos, shirts, and lounge products under the Chubbies brand name; consumables, such as color packs, starters, natural charcoal, and firewood products; and accessories comprising shelters, shields, roasting sticks, tools, paddles, and pumps under the Solo Stove, Oru, and ISLE brands. The company was founded in 2011 and is headquartered in Grapevine, Texas.

How the Company Makes Money

Solo Brands Inc generates revenue through the direct sale of its products via online platforms and retail partnerships. The company's primary revenue stream comes from its e-commerce website, where customers can browse and purchase items directly. Additionally, Solo Brands leverages strategic partnerships with retail stores and online marketplaces to broaden its reach and increase sales. The company emphasizes a strong brand presence and customer loyalty, supported by marketing and community engagement initiatives, which in turn drive repeat purchases and word-of-mouth referrals, contributing significantly to its earnings.

Solo Brands Inc Class A Financial Statement Overview

Summary

Solo Brands Inc Class A is experiencing financial challenges, with declining revenues and worsening margins indicating operational inefficiencies. The balance sheet reflects moderate leverage, but declining equity and poor ROE highlight profitability concerns. Cash flow issues are evident with negative free cash flow, pointing towards liquidity challenges.

Income Statement

Solo Brands Inc Class A has shown a declining revenue trend with a negative revenue growth rate from 2022 to 2024. The company's gross profit margin decreased from 61.5% in 2023 to 57.3% in 2024, indicating reduced efficiency in controlling production costs. The net profit margin further deteriorated due to increased net losses, reaching -39.6% in 2024, signaling significant profitability issues. Negative EBIT and EBITDA margins reflect operational challenges and inefficiencies.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 0.16 in 2024, suggesting moderate leverage. The return on equity has significantly declined, moving into negative territory, reflecting poor profitability relative to shareholder investments. The equity ratio is relatively stable at 39.1%, indicating a reasonable proportion of assets financed by equity, but the decline in stockholders' equity is concerning.

Cash Flow

There is a significant decline in free cash flow from 2023 to 2024, turning negative, which is a red flag for liquidity. The operating cash flow to net income ratio has improved but remains low, indicating challenges in converting net income into cash. The free cash flow to net income ratio is negative, highlighting issues in generating free cash flow relative to net losses.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
454.55M	494.78M	517.63M	403.72M	133.43M
	Gross Profit
260.26M	302.15M	318.18M	258.91M	86.97M
	EBIT
-174.62M	-227.85M	61.54M	68.86M	-20.46M
	EBITDA
-149.44M	48.47M	58.45M	87.09M	-15.22M
	Net Income Common Stockholders
-113.36M	-111.35M	-7.62M	48.65M	-24.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.98M	19.84M	23.29M	25.10M	32.75M
	Total Assets
495.06M	659.32M	862.35M	837.74M	542.41M
	Total Debt
30.70M	182.48M	113.38M	128.15M	73.35M
	Net Debt
18.72M	162.63M	90.09M	103.05M	40.59M
	Total Liabilities
301.70M	287.06M	287.35M	263.57M	210.31M
	Stockholders Equity
193.36M	241.26M	363.43M	360.88M	332.10M
Cash Flow		Free Cash Flow
-4.00M	53.33M	23.15M	-20.89M	31.72M
	Operating Cash Flow
10.52M	62.42M	32.40M	-10.25M	32.68M
	Investing Cash Flow
-14.51M	-53.08M	-10.02M	-143.89M	-274.10M
	Financing Cash Flow
-3.66M	-12.87M	-23.54M	146.48M	281.07M

Solo Brands Inc Class A Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.18
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTC, the sentiment is Negative. The current price of 0.18 is below the 20-day moving average (MA) of 0.41, below the 50-day MA of 0.74, and below the 200-day MA of 1.34, indicating a bearish trend. The MACD of -0.18 indicates Positive momentum. The RSI at 20.69 is Positive, neither overbought nor oversold. The STOCH value of 13.26 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DTC.

Solo Brands Inc Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DECK	76 Outperform	$17.75B	18.98	39.80%	―	19.40%	32.70%
YETI	75 Outperform	$2.81B	16.51	24.01%	―	10.32%	6.05%
COLM	63 Neutral	$4.22B	19.96	12.01%	1.57%	-3.35%	-6.09%
NKE	63 Neutral	$97.33B	21.87	31.93%	2.30%	-7.16%	-12.12%
Sector *	59 Neutral	$12.60B	11.17	0.97%	3.72%	1.34%	-21.34%
CLAR	49 Neutral	$152.30M	33.59	-33.68%	2.55%	-7.66%	-413.50%
DTC	41 Neutral	$19.15M	―	-60.46%	―	-8.13%	0.04%

Solo Brands Inc Class A Corporate Events

Solo Brands Inc. Appoints New Independent Director

On March 7, 2025, Solo Brands Inc. appointed Peter Laurinaitis as a Class III independent director, expanding its board from seven to eight members. The company also announced its financial results for the fourth quarter and full year 2024, highlighting a strategic transformation plan to stabilize its business amid challenging results. Despite a decrease in net sales and a net loss, the company is focusing on a turnaround plan with over 30 initiatives to improve operations and liquidity, while facing substantial doubt about its ability to continue as a going concern.

Solo Brands Inc Faces NYSE Non-Compliance Notice

On February 25, 2025, Solo Brands, Inc. received a notice from the New York Stock Exchange (NYSE) indicating non-compliance with the minimum average closing price requirement of $1.00 per share for its Class A common stock over a consecutive 30 trading-day period. The company has six months to regain compliance, which may involve a reverse stock split, but the notice does not immediately impact the stock’s listing or trading. The company’s operations and reporting obligations remain unaffected, and the stock will continue trading under the symbol ‘DTC’ with a ‘.BC’ designation to indicate non-compliance.

Solo Brands Inc Appoints John Larson as Interim CEO

On February 18, 2025, Solo Brands, Inc. announced the appointment of John P. Larson as Interim President and CEO, succeeding Christopher Metz who resigned to ensure a smooth transition. Larson, who has a rich background in leading enthusiast brands, will guide the company while the Board searches for a permanent CEO, with Metz remaining in a non-executive role until March 7, 2025.

Solo Brands Inc Board Reshuffle with New Appointments

On January 16, 2025, Julia M. Brown resigned from the Board of Directors of Solo Brands, Inc., effective January 20, 2025. Subsequently, on January 22, 2025, Elisabeth Vanzura was appointed to the Board and the Nominating and Corporate Governance Committee. John Larson was named chair of this committee following Ms. Brown’s resignation. Ms. Vanzura brings significant marketing expertise, having co-founded GAI Insights and previously held senior roles at various companies. Her compensation includes cash retainers and restricted stock units. The company anticipates her contributions will enhance its governance and strategic direction.