Grove Collaborative Holdings, Inc. (GROV) Financial Performance Analysis
Grove Collaborative Holdings, Inc. (NYSE:GROV) is a company that focuses on providing eco-friendly household products. It aims to offer sustainable alternatives to everyday items, promoting a greener lifestyle. However, when it comes to financial performance, GROV faces challenges, particularly in its ability to generate returns on its invested capital.
GROV's Return on Invested Capital (ROIC) is -51.38%, which is significantly lower than its Weighted Average Cost of Capital (WACC) of 14.41%. This negative ROIC indicates that the company is not generating enough returns to cover its cost of capital, leading to inefficiencies in capital utilization. The ROIC to WACC ratio of -3.57 further highlights this issue.
In comparison, Comera Life Sciences Holdings, Inc. (CMRA) demonstrates a stark contrast with a ROIC of 1768.56% and a WACC of 4.07%. This results in a ROIC to WACC ratio of 434.29, showcasing an extremely efficient use of capital. CMRA's ability to generate high returns relative to its cost of capital sets it apart from GROV.
Swvl Holdings Corp. (SWVL) also shows effective capital utilization with a ROIC of 82.31% and a WACC of 7.04%, resulting in a positive ROIC to WACC ratio of 11.69. This indicates that SWVL is successfully generating returns that exceed its cost of capital, unlike GROV.
On the other hand, Virax Biolabs Group Limited (VRAX) and Intelligent Living Application Group Inc. (ILAG) share similar challenges with GROV, having negative ROICs of -121.05% and -22.71%, respectively. However, their ROIC to WACC ratios of -10.40 and -2.74 suggest slightly different levels of inefficiency compared to GROV.
| Symbol | Price | %chg |
|---|---|---|
| UNVR.JK | 1780 | 0 |
| 090435.KS | 39350 | 0.13 |
| 090430.KS | 125500 | 0.24 |
| HINDUNILVR.NS | 2335 | 0.15 |
Grove Collaborative Holdings, Inc. (NYSE:GROV) Earnings Report Overview
- Grove Collaborative Holdings, Inc. (NYSE:GROV) reported an EPS of -$0.33, missing estimates.
- The company surpassed revenue expectations with approximately $49.5 million.
- GROV achieved a positive adjusted EBITDA for the year, indicating improved financial health and operational efficiency.
Grove Collaborative Holdings, Inc. (NYSE:GROV) is a company that focuses on providing sustainable home and personal care products. It operates in a competitive market with other eco-friendly brands. On March 11, 2025, GROV reported its earnings after market close, revealing an earnings per share (EPS) of -$0.33, which was below the estimated -$0.15. Despite this, the company generated a revenue of approximately $49.5 million, surpassing the estimated $48.8 million.
During the Q4 2024 earnings conference call, CEO Jeff Yurcisin and Interim CFO Tom Siragusa discussed the company's financial performance and strategic direction. The call highlighted Grove's sequential revenue growth and achievement of a positive adjusted EBITDA for the entire year, marking a significant milestone in the company's financial health and operational efficiency.
GROV's financial metrics reveal some challenges. The company has a price-to-earnings (P/E) ratio of -2.29, indicating ongoing losses. The price-to-sales ratio is 0.33, suggesting the stock is valued at about 33 cents for every dollar of sales. The enterprise value to sales ratio is 0.31, reflecting a similar valuation perspective.
The enterprise value to operating cash flow ratio is -7.05, highlighting GROV's negative cash flow situation. With an earnings yield of -43.76%, the company is not generating positive earnings for its shareholders. The debt-to-equity ratio is -1.71, indicating more liabilities than equity. However, the current ratio of 1.66 suggests GROV has a reasonable level of liquidity to cover its short-term obligations.
Grove Collaborative Holdings, Inc. (NYSE:GROV) Financial Analysis and Industry Comparison
- Grove Collaborative Holdings, Inc. (NYSE:GROV) is not generating returns on invested capital that exceed its cost of capital, indicating challenges in creating value for shareholders.
- The company's ROIC is at -19.84% and WACC stands at 14.73%, resulting in a negative ROIC/WACC ratio of -1.35.
- Comparative analysis with peers like Comera Life Sciences Holdings, Inc. (NASDAQ:CMRA), Swvl Holdings Corp. (NASDAQ:SWVL), and Virax Biolabs Group Limited (NASDAQ:VRAX) highlights varying levels of operational efficiency and value creation within the industry.
Grove Collaborative Holdings, Inc. (NYSE:GROV) is a company that focuses on providing consumers with sustainable and environmentally friendly products, ranging from household cleaning items to personal care and pet care products. Operating out of San Francisco, California, GROV aims to make a positive impact on the environment by offering plastic-neutral products. This approach sets it apart from many competitors in the retail sector, emphasizing the growing consumer demand for sustainable goods.
The financial health of GROV can be assessed through its ROIC (Return on Invested Capital) and WACC (Weighted Average Cost of Capital) figures. With a stock price of $1.27, the company's WACC stands at 14.73%, while its ROIC is at -19.84%. The negative ROIC/WACC ratio of -1.35 indicates that GROV is currently not generating returns on invested capital that exceed its cost of capital. This situation suggests that, at present, the company is not creating value for its shareholders, which is a critical aspect for investors to consider.
When comparing GROV to its peers, it's evident that the company is facing challenges in generating positive returns above its costs. For instance, Comera Life Sciences Holdings, Inc. (NASDAQ:CMRA) boasts the highest ROIC/WACC ratio among the peers at 533.69, indicating a significantly high return on invested capital compared to its cost of capital. This comparison highlights the varying performance levels within the industry, with CMRA showcasing exceptional growth potential despite being in a preclinical stage.
Other companies like Swvl Holdings Corp. (NASDAQ:SWVL) and Virax Biolabs Group Limited (NASDAQ:VRAX) also present interesting contrasts. SWVL, with a ROIC/WACC ratio of 21.63, and VRAX, despite a negative ratio of -9.92, show different levels of value creation and operational efficiency. These comparisons underline the diverse strategies and outcomes within the sector, from mass transit ridesharing services to biotechnology firms selling diagnostic test kits.
In summary, Grove Collaborative Holdings, Inc.'s current financial metrics suggest that the company is struggling to generate value for its shareholders, as indicated by its negative ROIC/WACC ratio. This analysis, when placed in the context of its peers, provides a broader view of the company's performance and the competitive landscape it operates within. Investors looking at GROV should consider these factors alongside the company's sustainability mission and market position.
