Reformation Inc. (REF)

Price$14.08+0.42 (+3.07%)As of 2026-10-12 21:26 UTC

AI: Fair-priced

Verified womenswear retailer following a recent IPOREF is the NYSE-listed common stock of Vernon, California-based Reformation Inc., quoted in USD—not a similarly named fund or unrelated issuer. Trading began July 30, 2026. It is an established operating retailer, not a shell. Historical audited annual statements are available, but there is no completed post-IPO full-year reporting period yet.

Latest results cover June 27, released September 10. Quarterly revenue increased 24.1% to $155.2 million, gross margin reached 66.7%, and GAAP net income rose to $12.4 million. Direct-to-consumer revenue was $135.3 million; wholesale and other revenue contributed $19.9 million. The company ended the quarter with 70 stores.

Sales valuation is moderate, but recurring earnings require adjustmentStock Analysis reports approximately $730.8 million of equity capitalization, 1.30 times trailing sales, and 56.26 times trailing earnings. These are provider-reported metrics, not intrinsic-value estimates. Strong revenue growth supports value, but the earnings multiple is not conventionally cheap.

First-half net income was only $260,000. Results included a $12.3 million tariff-related reduction in product costs and $24.4 million of stock-based compensation. These distort comparisons with normalized earnings. Enterprise-value screens retaining June debt also fail to reflect the subsequent IPO-funded repayment.

IPO deleveraging improves the balance sheet; cash conversion remains weakFirst-half operating cash flow was just $26,000 before $13.216 million of capital expenditure. June-end cash was $76.6 million against $246.7 million of term debt. The cash-flow figures demonstrate that accounting profitability was not yet translating into cash after investment.

The IPO generated $125.7 million net after costs. Subsequently, $110 million repaid term loans and $8.5 million repurchased existing shares and options. June balances therefore are not September liquidity figures. Credit facilities mature in June 2031; variable interest rates and lease commitments remain financial obligations.

Concentrated ownership and execution risks warrant a valuation discountAfter the IPO, Permira owned approximately 49.2% and the Aflalo Family Trust 19.8%. Unremediated financial-reporting control weaknesses and potential equity-award dilution add shareholder risks. The company does not currently pay a common dividend.

Fashion misjudgments, tariff changes, customer-acquisition costs, and unsuccessful store expansion could weaken margins. MarketWatch reports September 25 volume of approximately 434,720 shares. The short public-trading history and relatively limited float mean that quoted prices do not guarantee execution depth for sizeable orders, especially after hours.

AI: News

September 17–20: Index additions expand market visibilityS&P Capital IQ reported Reformation's addition to the Russell 2000 Index on September 17 and the S&P Total Market Index on September 20. These are independently reported market-structure developments following the IPO.

The notices do not quantify associated fund purchases or establish a durable improvement in trading liquidity. Index inclusion is neither a capital raise nor evidence of stronger operating earnings, and no assumed passive-investment inflow is included in this valuation assessment.

September 10: First public earnings release sets growth and expansion expectationsReformation reported 22.9% growth in active customers, while direct-to-consumer revenue per customer declined 1.4%. International revenue increased 36.8%, supporting expansion beyond the United States.

Management forecast fiscal 2026 revenue of $602–606 million, adjusted EBITDA margin of 14.0–14.2%, and $23–27 million of capital expenditure associated with 15–16 planned new stores. These are forecasts, not completed results. Adjusted EBITDA excludes expenses and is not GAAP net income or free cash flow.

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Revenue

2023

2024

2025

Net income

2023

2024

2025

Free cash flow

2023

2024

2025

Total cash / debt

CashTotal debt

2024

2025

Financial statements

	2025	2024	2023
Revenue	$507.1M	$438.2M	$359.5M
Gross profit	$305.5M	$282.6M	$230.3M
Gross margin	60.24%	64.50%	64.07%
Operating expenses	$276.7M	$229.9M	$192.8M
Operating income	$28.8M	$52.7M	$37.6M
Operating margin	5.68%	12.02%	10.45%
EBITDA	$44.6M	$66.5M	$47.2M
EBITDA margin	8.80%	15.17%	13.14%
Net income	$12.6M	$32.9M	$23.9M
Net profit margin	2.49%	7.52%	6.64%
Basic EPSper basic share	$0.21	$0.56	$0.40
Diluted EPSper diluted share	$0.21	$0.56	$0.40