REAL Should I Buy
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RealReal Inc (REAL) is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's strong growth in GMV, improving operational efficiency, and positive analyst sentiment outweigh the risks of insider selling and recent net income decline. The pre-market price surge and positive technical indicators further support this decision.
The MACD is positively expanding, indicating bullish momentum. RSI is neutral at 61.587, showing no overbought or oversold conditions. Moving averages are converging, suggesting a potential breakout. The pre-market price of $13.52 is above the key resistance level R1 ($12.228), indicating strong upward momentum.
Q4 2025 GMV grew 22% YoY, surpassing $2 billion for the year.
Adjusted EBITDA reached $22 million, showing improved operational efficiency.
Analysts have raised price targets significantly, with multiple firms maintaining Buy or Overweight ratings.
The stock price has increased by 81% over the past year, outperforming the S&P 500.
Insiders are selling, with a 181.38% increase in selling activity over the last month.
Net income and EPS declined significantly YoY in Q4
Kanen Wealth Management reduced its stake, selling over 2.3 million shares.
In Q4 2025, revenue increased by 7.46% YoY to $176.23 million, and GMV grew 22% YoY to $616 million. However, net income dropped by 43.35% YoY to -$38.78 million, and EPS fell by 50% YoY to -0.31. Gross margin also declined slightly to 72.28%.
Analysts are optimistic, with multiple firms raising price targets (ranging from $15 to $20) and maintaining positive ratings. KeyBanc and Wells Fargo have Overweight ratings, citing confidence in EBITDA improvement and growth potential. William Blair projects 40% annualized earnings growth over the next three years.
