Rent the Runway Inc. Class A Common Stock (RENT)

FairStock Score: 73/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Rent the Runway as a possible cigar butt, not a compounder. It rents designer clothing and accessories through subscription, rental, and resale, with 942 employees. The business has some brand recognition, but I see little durable moat: customers can switch to buying, resale, or rival rentals, and the company must manage inventory, logistics, and fashion risk. The filed numbers are erratic. In FY2025, revenue was $43.8M, net income was $22.6M, and diluted EPS was $1.88, versus FY2024 revenue of $40.7M and a net loss of $69.9M. But fiscal Q2 2026, the quarter ended 2026-07-31, showed revenue of $13.9M and a net loss of $12.9M, or diluted EPS -$0.38; fiscal Q1 2026 had a $18.9M net loss. The prior fiscal Q3 2025 included $76.5M of net income and $13.65 diluted EPS, making trailing earnings suspect. Financial health is poor: trailing free cash flow is -$66.4M, a -110.4% FCF yield on the $60.1M market cap; ROCE is -12.67%; Altman Z is -7.86; Piotroski is 4/9. At the 2026-10-13 close of $1.78, FairStock's P/E is 0.19 and EV/EBITDA is 1.92, which look cheap only if profits are real and repeatable. The Lynch category is TURNAROUND — returned to profit after a loss within the last three years. I would demand evidence of sustainable cash generation before trusting the optics. Otherwise, this is speculation on survival, not a margin-of-safety bargain.

In plain English: Rent the Runway rents designer clothes and accessories through subscriptions, rentals, and resale. The company has grown revenue and reported a profit in its latest full year, but it is still losing money in recent quarters and burning cash. At $1.78, the stock looks very cheap next to reported earnings, but those earnings have been jumpy, so it is hard to call the price a clear bargain.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-07-31) · fiscal Q1 2026 10-Q (period ended 2026-04-30) · fiscal Q3 2025 10-Q (period ended 2025-10-31) · fiscal Q2 2025 10-Q (period ended 2025-07-31) · FY2025 10-K (period ended 2026-01-31) · FY2024 10-K (period ended 2025-01-31) · FY2023 10-K (period ended 2024-01-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer