Key Takeaways
- FIGS stock climbed 48.9% in the month through October 19, outperforming the S&P 500’s 0.6% gain.
- Second-quarter revenue increased 28.8% to $196.6 million, prompting management to raise its full-year growth outlook to about 20%.
- Shares traded at approximately 55x forward earnings, while analysts expected normalized EPS growth of just 6% in 2027.
- Holding looks more attractive than buying more ahead of November 5 earnings, given the stock’s premium valuation.
FIGS (FIGS) stock surged 48.9% in the month ended October 19, closing at $19.45 as investors rewarded the healthcare apparel company for its improving financial performance.
The rally significantly outpaced the broader market. The S&P 500 gained just 0.6% during the same period, while the Nasdaq 100 declined 0.4%.
Interestingly, FIGS released almost no company-specific news during the stretch. Strong earnings, rising expectations, and momentum appear to have fueled the gains.
The question now is whether those improving fundamentals justify its increasingly expensive valuation.
What’s Driving FIGS Stock Higher?
FIGS experienced several sharp price movements, including a 12.4% gain on October 12, when trading volume reached approximately 11.3 million shares, nearly four times its usual level.
The rally followed an impressive second-quarter earnings report in August. Revenue increased 28.8% year over year to $196.6 million, marking the company’s third consecutive quarter of growth exceeding 25%.
Diluted EPS reached $0.15, compared with analyst expectations of $0.07. Management raised its full-year revenue growth outlook to about 20%, from 14% to 16%, and expanded its share repurchase authorization by $100 million.
CEO Trina Spear highlighted the company’s “strong, ongoing traction across the business,” reflecting improvements across its operations.
Non-scrubwear revenue grew 40.3% to $35.4 million, while international revenue surged 67% to $37.9 million.
By comparison, Nike (NKE) reported a 4% revenue decline in its fiscal first quarter of 2027. Although the companies serve different apparel markets, FIGS’ stronger recent sales momentum stands out.
Profitability also improved. Gross margin reached 75.2%, up 820 basis points, although 780 basis points came from tariff refunds. Adjusted EBITDA margin increased to 18.6% from 12.9%, excluding the benefit of prior-year tariff refunds.
Those results explain why Wall Street has become more optimistic.
Analysts expect normalized EPS of $0.36 in 2026, nearly double the $0.19 recorded in 2025.
However, consensus estimates suggest EPS will reach only $0.38 in 2027, representing approximately 6% growth.
That slowdown raises questions about how much investors should pay for FIGS’ future earnings.
Is FIGS Stock Getting Too Expensive?
Wall Street has significantly raised its expectations for FIGS over the past year, reflecting stronger financial performance and improving confidence in its growth outlook.
The average analyst price target increased from approximately $7 in October 2025 to around $19 by late September 2026.
However, FIGS’ October 19 closing price of $19.45 already exceeded the $18.62 consensus target.
Analysts remain divided. Roth MKM maintained a Buy rating with an $18 target, while Barclays assigned a $20 target. Morgan Stanley was more cautious with a $15 target, and Raymond James maintained its Hold rating.
Valuation presents another challenge.
FIGS traded at approximately 55x forward earnings as of October 16, far below its late-2021 peak above 200x but almost twice its November 2022 low of approximately 30x.
The multiple reflects confidence in continued growth. Yet with normalized EPS expected to increase only about 6% in 2027, investors are paying a premium for future earnings that may not grow as quickly.
Should Investors Take Profits or Buy More?
FIGS is scheduled to report third-quarter results on November 5, providing the next major test for its rally.
After gaining nearly 49% in a month, simply meeting expectations may not be enough to sustain the momentum. Another earnings beat and stronger guidance could support further gains.
The business remains attractive, supported by three consecutive quarters of revenue growth exceeding 25%, improving profitability, and expanding international sales.
However, the valuation looks demanding, especially with shares already trading above Wall Street’s average price target.
For existing shareholders, holding looks better than taking profits or buying more right now. FIGS’ strong revenue growth supports staying invested, but its 55x forward earnings valuation makes adding shares before November earnings difficult to justify.
The November 5 earnings report should provide a clearer picture of whether the company’s growth can support its premium valuation.
So what is FIGS stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
