FIGSCarter's

FIGS vs Carter's

FIGS vs Carter's: this page compares business models, financial performance, and market context for two leading apparel retailers. It presents neutral, accessible information to help readers understan...

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Ethical Fashion

Invest in companies shaping the sustainable future of fashion. These carefully selected stocks represent innovators who are transforming how clothes are made, sold, and reused while meeting growing consumer demand for responsible apparel.

Published: June 17, 2025

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Investment Analysis

FIGS

FIGS

FIGS

Pros

  • FIGS reported a strong Q3 2025 with 8% year-over-year revenue growth reaching $151.7 million, beating analyst expectations.
  • The company improved gross margin by 280 basis points to 69.9% and increased adjusted EBITDA margin to 12.4%, indicating enhanced profitability.
  • FIGS has a strong balance sheet with zero debt and a high financial health rating.

Considerations

  • Despite beating earnings estimates, FIGS's stock price declined slightly after earnings, reflecting possible market concerns about valuation or future momentum.
  • The company's earnings per share remain modest with a diluted EPS of $0.04 and a high price-to-earnings ratio near 188, suggesting valuation risks.
  • Long-term price forecasts show high volatility with potential downside in 2025 and mixed analyst sentiment, indicating execution and market risk.

Pros

  • Carter's has a well-established brand with significant market share in the children’s apparel sector.
  • The company exhibits stable cash flow generation and maintains a solid balance sheet with manageable debt levels.
  • Carter's benefits from a diversified product portfolio and extensive distribution channels, supporting steady revenue streams.

Considerations

  • Carter's faces risks from changing consumer preferences and increasing competition in the children’s apparel market.
  • The company has exposure to supply chain disruptions and cost inflation, which can pressure margins.
  • Growth prospects may be limited by market saturation and slower organic expansion relative to newer, faster-growing apparel peers.

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