Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Equity Bottom-Up

Bassett Furniture Inds / Equity Bottom-Up

<ul><li>Herein, we analyze and discuss Bassett’s 2QFY24 earnings report.</li><li>Management reported its results for the interim period that ended on June 1, 2024, on Wednesday after market close.</li><li>It also conducted its “first-ever” management-sponsored and conducted earnings conference call on Thursday before market open, taking and answering analyst questions live.</li></ul>

Herein, we analyze and discuss Bassett’s 2QFY24 earnings report.Management reported its results for the interim period that ended on June 1, 2024, on Wednesday after market close.It also conducted its “first-ever” management-sponsored and conducted earnings conference call on Thursday before market open, taking and answering analyst questions live.

Bassett Furniture Industries, Inc. - 2QFY24 Results Were Ugly

Thematic (Sector/Industry)

<ul><li>Furniture and Furnishing stocks performed well against the major market indices, where the relative calm at the level of the overall indices belied the leadership churn and rotation back into tech following the recent Fed rate cuts (1).</li><li>The Water Tower Research Commercial/Contract Furniture index (+0.5%), Residential Manufacturers &amp; Suppliers (+4.5%), and Home Goods Retailers index (+1.0%) we up all up more than the DJ30 and SP50 (both +0.3%) while the Mass Retailers index (-1.5%) and R2K (-0.2%) were both down.</li><li>In a market where technology stocks are again leading and big caps are outperforming smaller caps, the relative outperformance of the Water Tower Research indices is notable. </li></ul>

Furniture and Furnishing stocks performed well against the major market indices, where the relative calm at the level of the overall indices belied the leadership churn and rotation back into tech following the recent Fed rate cuts (1).The Water Tower Research Commercial/Contract Furniture index (+0.5%), Residential Manufacturers &amp; Suppliers (+4.5%), and Home Goods Retailers index (+1.0%) we up all up more than the DJ30 and SP50 (both +0.3%) while the Mass Retailers index (-1.5%) and R2K (-0.2%) were both down.In a market where technology stocks are again leading and big caps are outperforming smaller caps, the relative outperformance of the Water Tower Research indices is notable. 

Furniture/Furnishings Weekly - F/F Stocks Poised for a Breakout (?)

<ul><li>Bassett’s 1QFY24 operating results disappointing, but not surprising.</li><li>In its 2023 Annual Report, Bassett CEO Rob Spilman’s opening line was, “The other side of the COVID sales boom has proven to a rough ride for the home furnishings sector.”</li><li>It remains challenging. Several untimely winter storms hit on important selling days, including the MLK holiday sale period. </li></ul>

Bassett’s 1QFY24 operating results disappointing, but not surprising.In its 2023 Annual Report, Bassett CEO Rob Spilman’s opening line was, “The other side of the COVID sales boom has proven to a rough ride for the home furnishings sector.”It remains challenging. Several untimely winter storms hit on important selling days, including the MLK holiday sale period. 

Bassett Furniture Industries, Inc. - 1QFY24 Disappointing but Not Surprising

<ul><li>We are initiating coverage of Bassett Furniture Industries, Inc., publicly traded under the ticker BSET.</li><li>Bassett primarily operates in two segments: Retail and Wholesale.</li><li>A third segment, Corporate &amp; Other, accounts for corporate and unallocated expenses, as well as the operating results of Noa Home, a recent e-commerce acquisition.</li></ul>

We are initiating coverage of Bassett Furniture Industries, Inc., publicly traded under the ticker BSET.Bassett primarily operates in two segments: Retail and Wholesale.A third segment, Corporate &amp; Other, accounts for corporate and unallocated expenses, as well as the operating results of Noa Home, a recent e-commerce acquisition.

Bassett Furniture Industries, Inc. - A Survivor Pursuing Success

<ul><li>As smaller-cap stocks outperformed, the Water Tower Furniture and Furnishings indexes posted strong gains.</li><li>The Water Tower Research Commercial/Contract Manufacturers Index (+3.5%), Residential Manufacturers &amp; Suppliers Index (+3.8%), Home Goods Retailers Index (+10%), and Mass Retailers Index (+5.3%) outperformed the S&amp;P 500 and DJ30 (both +2.8%). The R2K was up (+4.0%).</li><li>RH and LOVE earnings calls shine additional light on tough industry conditions.</li></ul>

As smaller-cap stocks outperformed, the Water Tower Furniture and Furnishings indexes posted strong gains.The Water Tower Research Commercial/Contract Manufacturers Index (+3.5%), Residential Manufacturers &amp; Suppliers Index (+3.8%), Home Goods Retailers Index (+10%), and Mass Retailers Index (+5.3%) outperformed the S&amp;P 500 and DJ30 (both +2.8%). The R2K was up (+4.0%).RH and LOVE earnings calls shine additional light on tough industry conditions.

Furniture/Furnishings Weekly  - September 16, 2024

United States

Bassett Furniture Industries, Incorporated manufactures and sells a full line of furniture for the home.  The Company offers bedroom and dining suites, occasional tables and entertainment units, upholstered sofas and love seats, recliners, and mattresses, among other products.  Bassett's products are sold through retailers, including Bassett Furniture Direct.

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Bassett Furniture Inds (BSET US)

Bassett Furniture Industries, Inc. - 2QFY24 Results Were Ugly

Herein, we analyze and discuss Bassett’s 2QFY24 earnings report. Management reported its results for the interim period that ended on June 1, 2024,...

Water Tower Research

Furniture/Furnishings Weekly - F/F Stocks Poised for a Breakout (?)

In a market where technology stocks are again leading and big caps are outperforming smaller caps, the relative outperformance of the Water Tower...

Water Tower Research

Bassett Furniture Industries, Inc. - 1QFY24 Disappointing but Not Surprising

In its 2023 Annual Report, Bassett CEO Rob Spilman’s opening line was, “The other side of the COVID sales boom has proven to a rough ride for the...

Water Tower Research

Bassett Furniture Industries, Inc. - A Survivor Pursuing Success

A third segment, Corporate & Other, accounts for corporate and unallocated expenses, as well as the operating results of Noa Home, a recent e...

Water Tower Research

Furniture/Furnishings Weekly - September 16, 2024

RH’s upcoming push into the European fashion capitals of Milan, Paris, and London, and continued reimaging of its US retail footprint, could be the...

Water Tower Research

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