1-800-Flowers ($FLWS) – Undervalued and beaten down – Yes another post about it.

1-800-Flowers is more than a covid darling, they are a boomers gifting haven.  They own popular brands such as Harry & David, Cheryls Coookies, Shari’s Berries, FruitBouquets, Popcorn Factory, Wolfermans Bakery, Personalizationmall.com, and others.  They also are getting high margin traction with Bloom.net which is a shopify like offering for local florist.

I firmly believe, this group of companies is being unfairly priced in the market and beaten down like bankruptcy is imminent, but that is not the case.

·         Fundamentals –

o   A major issue with FLWS is sales have been declining since Covid peaks making it an easy short from it’s previously extremely lofty Covid valuations.  During this time they have still continued to reduce debt, a previous quarter’s impairment is additionally dragging down EPS greatly, which management views as a onetime impairment not ongoing.  2025 was a negative cash flow year with declining revenue as well, creating a shorts dream.

·         Turn Around –

o   Multichannel expansion: Meeting shoppers where they are at (Delivery Apps, Amazon, Etc)

o   Loyalty Program: Updating loyalty program beyond free shipping benefits

·         Float  –

o   McCann family owns 50+% of the float and not frequent sellers

o   29.7% (Market Beat), 44.4% (Yahoo Finance), 102% (Fintel) short interest

o   Days to cover 9-11 on a thinly traded float

o   **Highly explosive if shorts operations turn and shorts are pressured.**

·         Valuations –

o   Price to sales = .13x

o   EV/Sales = .18x (Even a 2x expansion from here the price goes to $10+ per share)

https://preview.redd.it/fv984za742ng1.jpg?width=1522&format=pjpg&auto=webp&s=a22fa3f6b537ba5c5be09789471b41f580d9b19c

TLDR – Not a great company, but not nearly as bad as the market is pricing it.  In the midst of a turn around and signs of life will cause massive covering.  Explosive if triggered.  HODL