3 Reasons to Sell RVLV and 1 Stock to Buy Instead Radek Strnad Fri, October 16, 2026 at 10:35 AM EDT 3 min read ^GSPC -0.06% RVLV +0.82% Trade RVLV on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Over the last six months, Revolve's shares have sunk to $23.21, producing a disappointing 12.4% loss - a stark contrast to the S&P 500's 9.7% gain. This might have investors contemplating their next move.
Even with the cheaper entry price, we're sitting this one out for now. Here are three reasons why RVLV doesn't excite us, plus one stock we'd rather own.
A company's long-term sales performance is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, Revolve's 6.6% annualized revenue growth over the last three years was tepid. This was below our standard for the consumer internet sector.
As an online retailer, Revolve generates revenue growth by expanding its number of users and the average order size in dollars.
Over the last two years, Revolve's active customers , a key performance metric for the company, increased by 6.5% annually to 3.04 million in the latest quarter. This growth rate is slightly below average for a consumer internet business. If Revolve wants to reach the next level, it likely needs to enhance the appeal of its current offerings or innovate with new products.
Consumer internet businesses like Revolve grow from a combination of product virality, paid advertisement, and incentives (unlike enterprise software products, which are often sold by dedicated sales teams).
It's expensive for Revolve to acquire new users as the company has spent 59.4% of its gross profit on sales and marketing expenses over the last year. This inefficiency indicates that Revolve's product offering can be easily replicated and that it must continue investing to maintain an acceptable growth trajectory.
Revolve's business quality ultimately falls short of our standards. Following the recent decline, the stock trades at 12.1× forward EV/EBITDA (or $23.21 per share). This valuation tells us it's a bit of a market darling with a lot of good news priced in - we think there are better opportunities elsewhere. Let us point you toward the Amazon and PayPal of Latin America.
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