5 Most Shorted Stocks in September

3. Revolve Group, Inc. (NYSE:RVLV)

Number of Hedge Fund Holders: 20

Float Shorted: 35.30%

Revolve Group, Inc. (NYSE:RVLV) is a Cerritos, California-based fashion retailer targeting Generation Z and Millennial customers through various in-house brands.

Trevor Young at Barclays resumed coverage on Revolve Group, Inc. (NYSE:RVLV) stock on August 15 and downgraded it from an Equal Weight to an Underweight rating with a revised target price of $20, down from $30. The analyst highlighted that Revolve Group, Inc. (NYSE:RVLV) is strong in terms of execution and is growing at a quicker pace than its competitors due to its small base. However, Revolve Group, Inc. (NYSE:RVLV) stock is trading at an unjustifiable 100% premium against its competitors based on the expected revenues and earnings for 2023. In addition, there is a slowdown in revenue growth, and gross margins could come under pressure as full-price sales revert to normal levels.

Polen Capital discussed its outlook on Revolve Group, Inc. (NYSE:RVLV) in its Q1 2022 investor letter. Here’s what the firm said:

“Online fashion retailer Revolve had another favorable quarter, and our investment in this company has continued to compound at a high level. We were impressed with the company’s recent results, especially the combination of customer growth, the growing number of orders per customer, and improving average order values. We believe the company still has considerable room for growth as it benefits from the bourgeoning trend of fashion going online, while its investments in adjacent categories, like beauty, are increasing the market opportunity its addressing.”

As of Q2 2022, 20 hedge funds reported owning a stake in Revolve Group, Inc. (NYSE:RVLV).