The 180-day lockup period for Stitch Fix Inc. (SFIX) ends on May 16, 2018. When this six-month period ends, the company's pre-IPO shareholders and company insiders will have the opportunity to sell more than 56 million shares of currently-restricted stock. Any significant sales could cause a flood of shares into the secondary market and provide a short opportunity for risk-tolerant investors. Just 10 million shares of SFIX became eligible for trading pursuant to the IPO.
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The group of restricted shareholders includes eight individuals and three corporate entities.
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Stitch Fix has a return from IPO of 53%. The SFIX IPO had a first-day return of 1%.
Business Overview: Apparel Manufacturer Based in San Francisco
Stitch Fix is an online personalized apparel manufacturer based in San Francisco. The company's product portfolio includes apparel, accessories, and shoes in a wide variety of categories, product types, brands, and price points. Its categories are Women's, Men's, Maternity, and Plus, and its apparel includes dresses, denim, blouses, shoes, skirts, handbags, and jewelry. The company utilizes data science to tailor its portfolio based on a growing database of customer and merchandise data. Stitch Fix does this with its proprietary algorithms, and they impact its entire business model with prediction of forecast demand, purchasing behavior, inventory optimization, and designing new apparel.
(Source: Stitch Fix website)
Stitch Fix programs its SKUs with basic data, including size, brand, color, silhouette, pattern, and material. The SKUs also contain data on width, length, distance from collar to top button, diameter of sleeve openings, and other nuanced details. The company offers its apparel over multiple styles and price points from more than 700 brands.
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As of July 2017, Stitch Fix had close to 2.2 million active clients. Their repeat customer rates were 83% in 2016 and 86% in 2017. The company was originally incorporated as Rack Habit. It changed its name to Stitch Fix in 2011. Its headquarters are in San Francisco, and the company has approximately 5,800 employees.
