MeritValue

Lovesac Co

LOVEdata completeness 88%9 fiscal years on file
The thesis, from the filings

Lovesac Co earns about 22% on invested capital, far above its ~9% cost of capital, and has bought back 8% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $16.83 and $71.05 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2022FY 2023FY 2024FY 2025FY 2026
Revenue$498.2M1$651.2M2$700.3M3$680.6M3$697.1M3
Net income$47.5M4$26.5M5$23.9M6$11.6M6$4.07M6
Operating cash flow$32.6M7−$21.4M8$76.4M9$39M9$49.3M9
Capital expenditure$14.6M10$25.2M11$28.7M12$21M12$23.1M12
Free cash flow (derived)$18M7−$46.6M8$47.7M9$18M9$26.2M9
Total debt—————
Cash & equivalents$92.4M13$43.5M14$87M15$83.7M16$101.9M16
Diluted shares16.1M16.0M16.5M16.8M14.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$148.83
your share of equity
Profit it earned you last year
$2.77
Free cash flow it threw off
$17.82
Debt you’d be carrying
—

10 shares is a claim on $148.83 of net worth that earned you $2.77 and generated $17.82 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
22% avg · 5y
FY22 61%FY23 18%FY24 19%FY25 9%FY26 3%

It earned about 22% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−8% shares · 5y

Share count is down 8% over 5 years — management has been buying back stock, quietly handing owners a bigger slice.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $16.83 and $71.05 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$71.05
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth13.3%
  • fcfBase$26.2M
DCF · Growth Exit 5Y
$51.46
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth13.3%
  • fcfBase$26.2M
Earnings Power Value
$16.83
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$23.9M
  • growthAssumed0.0%
Graham Number
$9.68
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years13.3%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $51.46
The three cases
Bear0.0%$32.4
Base13.3%$51.46
Bull18.3%$61.23

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 13.3%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2022-01-30 · accession 0001628280-24-015804 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2023-01-29 · accession 0001628280-25-017241 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2024-02-04 · accession 0001628280-26-022929 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2022-01-30 · accession 0001628280-24-015804 (NetIncomeLoss)
  5. 10-K · period ending 2023-01-29 · accession 0001628280-25-017241 (NetIncomeLoss)
  6. 10-K · period ending 2024-02-04 · accession 0001628280-26-022929 (NetIncomeLoss)
  7. 10-K · period ending 2022-01-30 · accession 0001628280-24-015804 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2023-01-29 · accession 0001628280-25-017241 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2024-02-04 · accession 0001628280-26-022929 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2022-01-30 · accession 0001628280-24-015804 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2023-01-29 · accession 0001628280-25-017241 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2024-02-04 · accession 0001628280-26-022929 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K/A · period ending 2022-01-30 · accession 0001628280-23-040367 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2023-01-29 · accession 0001628280-24-015804 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2024-02-04 · accession 0001628280-25-017241 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2025-02-02 · accession 0001628280-26-022929 (CashAndCashEquivalentsAtCarryingValue)