- Kidpik (PIK) is an interesting but under-reported company with a subscription business model.
- Wall Street and/or meme-stock traders might start to take an interest in Kidpik, especially after a game-changing news item.
- Investors should conduct their due diligence and consider a small stock position in Kidpik.
Founded in 2016, New York-headquartered children’s clothing company Kidpik (NASDAQ:PIK) is part of a trend that’s been red-hot for a couple of years now: subscription-based businesses. Yet, hardly any heat has been generated around PIK stock – until recently, that this.
Don’t let the company’s name fool you. As we’ll discover, Kidpick is capable of generating serious revenues – this isn’t child’s play, by any means.
And if you think there’s no profit potential here, don’t kid yourself. Indeed, one of the biggest companies in the world is teaming up with Kidpick, but you can still pick up some shares while they’re cheap.
What’s Happening with PIK Stock?
Always-reliable InvestorPlace reporter Joel Bagole served up some fast facts on Kidpick, so be sure to check his article out.
As Bagole pointed out, the initial public offering (IPO) of PIK stock took place on Nov. 12, 2021. The stock closed its first day of trading at $7.59, but wobbled around after that and then collapsed.
The share price bottomed out at $1.51 in mid-March before it suddenly shot up above $4. Was this the handiwork of Reddit traders, perhaps?
Actually, it was a news-based rally, but we’ll get to that topic in a moment. Still, the Reddit short-squeeze crowd could certainly target PIK stock someday, as it’s low-priced and that makes it squeeze-friendly.
As for the company itself, Bagole observed that Kidpik delivers boxes of children’s clothes to households that pay for subscriptions. Every month, a new box (average cost: $98) containing three mix-and-match outfits (possibly including shoes) is delivered to the subscribers.
If you’re having trouble taking Kidpik seriously, consider this. The company increased its net revenue by 20.3% year-over-year to $5,574,099 during 2021’s third quarter.
Also in that time frame, Kidpick shipped out 559,000 items, up 18.9% year-over-year – not too shabby, wouldn’t you agree?
A Family-Friendly Collab
In case you’re not yet convinced that PIK stock is worth your investment capital, here’s a news item that might change your mind.
As InvestorPlace contributor Samuel O’Brient reported, Kidpick is teaming up with Disney (NYSE:DIS) to release several boxes inspired by the film Cheaper by the Dozen, streamed exclusively on Disney+.
According to the press release, Kidpik’s stylists curated four fashion boxes “featuring adorable grab-and-go looks” inspired by Cheaper by the Dozen. Their starting per-box price is $89.25.
Could this be the first of many collaborations with Disney? Only time will tell, but O’Brient made an excellent point as Kidpik is indeed “proving that partnerships with trusted household names can help boost a family-centric company.”
Maybe it’s a long shot, but speculators might consider the possibility of Kidpick getting bought out by a bigger company like Disney. Most likely, an event like that would push the PIK stock price much higher.
Yet, it’s not necessary to speculate about headline-grabbing takeovers. Just learn as much as you can about Kidpick, and you might find that it’s a small company with huge growth potential.
What You Can Do Now
PIK stock isn’t the safest investment you can make, as it’s low-priced and volatile.
However, it’s exciting to consider Kidpick’s revenue expansion and the possibility of future, value-added collaborations.
Therefore, don’t hesitate to pick up a few Kidpick shares if you envision a big future for family-oriented, subscription-based commerce in 2022.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.