Wayfair Inc. (NYSE:W) shares were little changed on Wednesday after posting a third-quarter beat, with revenue up 8.1% and adjusted EPS topping expectations.
The company reported third-quarter adjusted earnings per share of 70 cents, beating the analyst consensus estimate of 43 cents. Quarterly sales of $3.117 billion outpaced the Street view of $3.014 billion.
Here are the key analysts’ takes on the report:
- Needham analyst Bernie McTernan reiterated the Buy rating on Wayfair, raising the price forecast from $83 to $125.
- Bank of America analyst Michael McGovern upgraded the stock to Buy from Neutral, raising the price target to $ 130 from $ 86, citing multiple catalysts behind recent share gains.
Also Read: Wayfair Analysts Boost Their Forecasts After Strong Q3 Earnings
Needham: McTernan said revenue growth and revisions should now drive returns, given margin gains and today’s multiple. He expects macro tailwinds from improving industry trends and an early replacement cycle for COVID-era purchases.
He also sees faster housing turnover next year with 30-year mortgage rates in the low-6% range. McTernan added that Wayfair is pushing AI-powered personalization, deeper app engagement, and its Wayfair Rewards program.
He noted Wayfair Verified and physical retail as additional, company-specific growth levers.
This apart, Wayfair’s AI focus was evident from the CTO’s prepared remarks on the call, the analyst added. He noted early investments in personalization and AI could lift share and efficiency.
McTernan models 2026 revenue growth of 5 percent. He called that estimate a conservative starting point for the year.
His 2026 adjusted EBITDA estimate increases 9%, driven by 50-basis-point margin gains and a larger 2025 base. He now projects full-year positive net income in 2026.
Bank Of America Securities: McGovern highlighted the Castlegate logistics platform, loyalty improvements, and rising advertising penetration.
The analyst acknowledged a challenging macro backdrop and a notably cyclical industry in a three-year trough. McGovern likes the entry point ahead of an eventual housing market recovery.
According to the analyst, the firm’s demand catalysts include loyalty upgrades that also boost app downloads. Delivery speed and quality should improve as CastleGate gains momentum.
Wayfair plans to expand logistics capacity for multichannel fulfillment with off-platform partners.
That adds supplier value and lifts utilization of existing network capacity.
Margin drivers include fixed-cost leverage and stricter ROI discipline on advertising.
High-margin advertising revenue growth should further support margins, the analyst added.
McGovern said he now models fourth-quarter sales of $3.3 billion, up 5.9 percent year over year. He lifted his fourth-quarter EBITDA margin forecast by 60 basis points to 6.3%.
For 2026, he now predicts $12.98 billion in revenue and $830 million in EBITDA. His prior view was $12.75 billion and $730 million.
Price Action: W shares are trading higher by 1.52% to $108.20 at last check Wednesday.
Read This Next:
- Jim Cramer: This Stock’s ‘Hot As A Pistol,’ Sell Super Micro Computer
Image: Shutterstock
