The RealReal, Inc. Fundamental Analysis (NASDAQ: REAL)
The RealReal, Inc. (NASDAQ: REAL) shows strong financial fundamentals with a PE ratio of -15.82, profit margin of -10.82%, and ROE of 21.10%. The company generates $0.7B in annual revenue with strong year-over-year growth of 15.38%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 64.0/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze REAL's fundamental strength across five key dimensions:
Efficiency Score
WeakREAL struggles to generate sufficient returns from assets.
Valuation Score
ExcellentREAL trades at attractive valuation levels.
Growth Score
ExcellentREAL delivers strong and consistent growth momentum.
Financial Health Score
ModerateREAL shows balanced financial health with some risks.
Profitability Score
ModerateREAL maintains healthy but balanced margins.
Key Financial Metrics
Is REAL Expensive or Cheap?
P/E Ratio
REAL trades at -15.82 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, REAL's PEG of 0.16 indicates potential undervaluation.
Price to Book
The market values The RealReal, Inc. at -3.55 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at -86.32 times EBITDA. This is generally considered low.
How Well Does REAL Make Money?
Net Profit Margin
For every $100 in sales, The RealReal, Inc. keeps $-10.82 as profit after all expenses.
Operating Margin
Core operations generate -0.78 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $21.10 in profit for every $100 of shareholder equity.
ROA
The RealReal, Inc. generates $-21.45 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The RealReal, Inc. generates limited operating cash flow of $53.60M, signaling weaker underlying cash strength.
Free Cash Flow
The RealReal, Inc. produces free cash flow of $30.04M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.25 in free cash annually.
FCF Yield
REAL converts 2.25% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
-15.82
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.16
vs 25 benchmark
P/B Ratio
Price to book value ratio
-3.55
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.78
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
-1.23
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.83
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.21
vs 25 benchmark
ROA
Return on assets percentage
-0.21
vs 25 benchmark
ROCE
Return on capital employed
-0.04
vs 25 benchmark
How REAL Stacks Against Its Sector Peers
| Metric | REAL Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | -15.82 | 25.68 | Better (Cheaper) |
| ROE | 21.10% | 970.00% | Weak |
| Net Margin | -10.82% | -4902.00% (disorted) | Weak |
| Debt/Equity | -1.23 | 0.60 | Strong (Low Leverage) |
| Current Ratio | 0.83 | 2.33 | Weak Liquidity |
| ROA | -21.45% | 292.00% | Weak |
REAL outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The RealReal, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-29.55%
Industry Style: Cyclical, Growth, Discretionary
DecliningEPS CAGR
92.75%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
108.40%
Industry Style: Cyclical, Growth, Discretionary
High Growth