HAVERTYS HVT isn’t waiting for a turnaround in furniture. This Zacks Rank #5 (Strong Sell) will still open new stores in 2025 and 2026.

HAVERTYS is a furniture retailer founded in 1885 with 130 stores in 17 states in the Midwest and South. It also operates 3 regional distribution centers and 4 home delivery centers.

HAVERTYS Beats Big in the Fourth Quarter of 2024

On Feb 24, 2025, HAVERTYS reported its fourth quarter 2024 results and blew out the Zacks Consensus by $0.30. Earnings were $0.47 versus the consensus of $0.17.

However, it has only beat twice in the last 5 quarters as the furniture industry remains challenged.

Consolidated sales fell 12.5% to $184.4 million year-over-year. Comparable sales, an important metric for retailers, fell 13.7%.

For the full year, consolidated sales fell 16.1% to $722.9 million. Comparable sales fell 16.7% compared with 2023.

The business hasn’t found a bottom yet.

Gross profit margin for the year was 60.7%, the same as in 2023.

The good news was that HAVERTYS added 5 stores in 2024, opening 6 and closing 1. It returned to Houston for the first time in 40 years with 2 new stores.

Inventories also dropped to $83.4 million in 2024 from $94 million in 2023.

It’s free in-home design service also continued to expand. In the fourth quarter, design consultants were 31.8% of written business versus 29.2% in 2023.

HAVERTYS is a Dividend Aristocrat

HAVERTYS has an 89-year track record of consistent dividends. In 2024, HAVERTYS returned $25.5 million to shareholders. It paid quarterly dividends of $20.5 million and bought $5 million in common shares.

The current dividend is yielding 5.9%.

It has a strong balance sheet. As of Dec 31, 2024, the company had cash and cash equivalents of $126.3 million and no debt outstanding. It also had credit availability of $80 million.

Analysts Cut HAVERTYS Earnings Estimates

HAVERTYS continues to prepare for the turnaround in the furniture business which is based on a rebound in housing sales.

In 2025, it has planned capital expenditures of $27.1 million. In addition to the second store in Houston it opened in the first quarter of 2025, it expects to open another store in the third quarter of 2025 and others in mid-2026.

Analysts were too bullish going into 2025. The housing market has not rebounded this year, as many had expected.

As a result, 2 earnings estimates were cut in the last 30 days for 2025. The Zacks Consensus Estimate has fallen to $1.44 from $1.87 in the last 2 months.

That is still earnings growth of 25.2%, as the company made $1.15 in 2024.

Here’s what it looks like on the 5-year price and consensus chart.

Image Source: Zacks Investment Research

HVT Sells Off: Is It a Deal?

Shares of HAVERTYS have fallen 22.3% in the last 6 months. Here it is compared with homebuilder Pulte.

Image Source: Zacks Investment Research

It trades with a forward P/E of 15.1. While that is attractive, with the earnings being cut, it has some characteristics of a value trap.

Investors might want to stay on the sidelines until a bottom is found in HAVERTYS. Look for a reversal in the consensus earnings estimates and a better Zacks Rank for clues.

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Haverty Furniture Companies, Inc. (HVT) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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