B.Riley downgrades Brilliant Earth stock on metals cost pressure
Investing.com - B.Riley downgraded Brilliant Earth Group Inc (NASDAQ:BRLT) to Neutral from Buy and cut its price target to $1.50 from $3.00.
Analyst Anna Glaessgen cited metals price inflation as the primary factor disrupting the firm’s previously expected margin expansion through 2027. The cost burden from higher metals prices prompted revisions to the firm’s EBITDA estimates.
B.Riley noted that momentum in bridal sales has contributed to sustained top-line growth, a core element of its prior investment thesis. The firm said this aspect of its earlier outlook has materialized as expected. The company’s revenue reached $437 million over the last twelve months, though the stock has declined 48% over the past six months to its current price of $1.46.
The firm said a reversal of recent stock momentum depends on stabilizing gold and platinum prices. B.Riley characterized this outcome as potentially optimistic given recent geopolitical events.
The downgrade reflects a decision to move to the sidelines while awaiting greater margin visibility for the jewelry retailer.
In other recent news, Brilliant Earth Group Inc. reported its fourth-quarter 2025 financial results, which revealed a significant earnings miss. The company’s adjusted earnings per share (EPS) showed a loss of $0.06, falling short of the anticipated gain of $0.02, marking a negative surprise of 400%. Revenue for the quarter was $124.4 million, slightly below the forecasted $125.64 million. KeyBanc downgraded Brilliant Earth’s stock rating to Sector Weight from Overweight, citing concerns over margin pressures due to elevated precious metal prices. TD Cowen also lowered its price target for the company to $1.60 from $1.90, while maintaining a Hold rating, as the company issued softer guidance for the upcoming year. Jefferies adjusted its price target to $1.85 from $2.00, noting the company’s 4.1% year-over-year revenue growth driven by a 6.5% increase in order growth, despite a decline in average order value. These developments highlight the challenges Brilliant Earth faces amid rising costs and margin pressures.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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