A.K.A. Brands Holding Corp. (NYSE: AKA)

Sector: Consumer Cyclical Industry: Apparel Retail CIK: 0001865107
Market Cap 123.66 Mn
P/B 1.12
P/E -4.70
P/S 0.21
ROIC (Qtr) -4.24
Div Yield % 0.00
Rev 1y % (Qtr) -1.89
Total Debt (Qtr) 210.76 Mn
Debt/Equity (Qtr) 1.91

About

A.K.A. Brands Holding Corp., or a.k.a. Brands, operates in the vast global apparel, footwear, and accessories industry. This Delaware corporation, which was established in May 2021, is a collective of next-generation fashion brands designed for the modern consumer. Its portfolio includes four unique brands: Princess Polly, Petal & Pup, Culture Kings, and mnml. a.k.a. Brands' revenue is generated primarily through its e-commerce platform, which offers an extensive range of products including dresses, tops, shoes, and accessories. The company's main...

Read more

Price action

Investment thesis

Bull case

  • Tangible assets of 272.57M provide exceptional 21.20x coverage of deferred revenue 12.86M, showing strong service capability backing.
  • Robust tangible asset base of 272.57M provides 7.30x coverage of working capital 37.35M, indicating strong operational backing.
  • Tangible assets of 272.57M provide robust 5.39x coverage of other current liabilities 50.54M, indicating strong asset backing.
  • Operating cash flow of 21.75M provides strong 23.57x coverage of operating expenses 923000, showing operational efficiency.
  • Cash position of 23.43M provides strong 1.82x coverage of deferred revenue 12.86M, ensuring service delivery capability.

Bear case

  • Operating cash flow of 21.75M barely covers its investment activities of (16.24M), with a coverage ratio of -1.34, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 23.43M against inventory of 96.71M, the 0.24 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • The company's operating cash flow of 21.75M shows concerning coverage of stock compensation expenses of 7.79M, with a 2.79 ratio indicating potential earnings quality issues.
  • Operating earnings of (11.31M) show weak coverage of depreciation charges of 29.65M, with a -0.38 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 5.51M provides weak coverage of capital expenditures of 16.24M, with a 0.34 ratio suggesting additional external financing needs for growth initiatives.

Peer comparison

Companies in the Apparel Retail
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 TJX Tjx Companies Inc /De/ 175.80 Bn 34.34 2.98 13.19 Bn
2 ROST Ross Stores, Inc. 58.85 Bn 28.21 2.67 5.19 Bn
3 LULU lululemon athletica inc. 25.43 Bn 14.61 2.30 1.76 Bn
4 BURL Burlington Stores, Inc. 18.26 Bn 32.57 1.63 5.94 Bn
5 GAP Gap Inc 10.00 Bn 11.75 0.65 5.52 Bn
6 URBN Urban Outfitters Inc 7.11 Bn 14.53 1.18 1.18 Bn
7 ANF Abercrombie & Fitch Co /De/ 6.17 Bn 11.82 1.19 1.13 Bn
8 BOOT Boot Barn Holdings, Inc. 5.78 Bn 27.75 2.79 0.67 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.72 1.35
EV to Cash from Ops. EV/CFO 13.60 8.18
EV to Debt EV to Debt 1.40 4.33
EV to EBIT EV/EBIT -26.17 -60.97
EV to EBITDA EV/EBITDA 15.88 6.53
EV to Free Cash Flow [EV/FCF] EV/FCF 53.69 22.99
EV to Market Cap EV to Market Cap 2.39 2.06
EV to Revenue EV/Rev 0.50 1.11
Price to Book Value [P/B] P/B 1.12 3.23
Price to Earnings [P/E] P/E -4.70 195.16
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.88
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 12.58
Dividend per Basic Share Div per Share (Qtr) 0.00 0.36
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 16.33
Interest Coverage Int. cover (Qtr) -1.11 13.58
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -98.16 -5.40
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 1.51 89.63
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.25
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 21.18 13.95
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 48.46 -16.93
EBIT Growth (1y) % EBIT 1y % (Qtr) 19.41 10.85
EBT Growth (1y) % EBT 1y % (Qtr) 11.91 6.10
EPS Growth (1y) % EPS 1y % (Qtr) 15.17 10.94
FCF Growth (1y) % FCF 1y % (Qtr) 549.23 -129.32
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 8.54 -1.75
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.45 1.40
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.06
Cash Ratio Cash Ratio (Qtr) 0.22 0.38
Current Ratio Curr Ratio (Qtr) 1.35 1.59
Debt to Equity Ratio Debt/Equity (Qtr) 1.91 1.31
Interest Cover Ratio Int Coverage (Qtr) -1.11 13.58
Times Interest Earned Times Interest Earned (Qtr) -1.11 13.58
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 3.10 2.72
EBIT Margin % EBIT Margin % (Qtr) -1.90 -1.70
EBT Margin % EBT Margin % (Qtr) -3.61 -2.76
Gross Margin % Gross Margin % (Qtr) 57.40 40.52
Net Profit Margin % Net Margin % (Qtr) -4.40 -4.02