Is FIGS Stock a Buy as Growth Accelerates but Valuation Stays Rich?

FIGS Growth Profile Is Becoming More Durable

Second-quarter net revenues rose 28.8% year over year to $196.6 million, marking a third straight quarter of more than 25% growth. Active customers increased 13.2% to 3.1 million, while average order value climbed 8.5% to $127.

The gains were spread across products, geographies and ordinary selling days without specific brand activations. Net revenues per active customer reached a record $229, up 10.1%, suggesting that customer acquisition, repeat purchasing and higher spending are contributing together rather than relying on one launch cycle.

FIGS Has Multiple Paths Beyond Core Scrubs

Non-scrubwear revenues advanced 40.3% to $35.4 million and represented 18% of quarterly revenues. International revenues increased 67% to $37.9 million, while TEAMS and Community Hubs also delivered record results, broadening FIGS beyond its core scrubwear business.

International is positioned as a major multiyear growth vector, supported by expansion across more than 80 countries outside the United States and less than 1% global market share. Adjacent categories, institutional sales and retail hubs can also raise share of wallet and deepen customer access.

FIGS Profitability Is Improving With Scale

Adjusted EBITDA margin expanded to 18.6% from 12.9% a year earlier. Management raised its full-year 2026 adjusted EBITDA margin outlook to 14.8%-15%, alongside an approximately 20% net revenue growth forecast.

The improvement reflects higher full-price selling, lower return rates, digital customer-acquisition efficiencies and operating leverage. Those gains matter because they show FIGS can invest in growth while converting stronger demand into better profitability, even as some tariff-related benefits affect reported comparisons.

FIGS Premium Valuation Leaves Less Room for Error

Shares have gained about 25% over the past three months. The increase reflects improving investor confidence following stronger operating results, but it has also contributed to the stock’s elevated valuation.

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FIGS trades at 46.35X forward 12-month earnings, well above 15.28X for its industry. That premium raises the execution bar as management expects growth to moderate to about 20% in the third quarter and 10% in the fourth quarter.

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The broader apparel backdrop also argues for valuation discipline. lululemon athletica Inc. LULU reported 4% first-quarter fiscal 2026 revenue growth but reduced its full-year outlook to roughly flat. NIKE, Inc. NKE reported flat fiscal 2026 revenues, with NIKE Direct revenues down 6%. For FIGS, continued marketing investment, an 82% scrubwear revenue mix and supply-chain disruption tied to its Jordan sourcing partner add risks if growth slows.

FIGS Buy Signal Clashes With Weak Value Scores

FIGS currently carries a Zacks Rank #2 (Buy), which points to favorable near-term earnings-estimate momentum. The stock also has a Momentum Score of A, supporting the case that recent price and estimate trends remain constructive. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The other Style Scores are less supportive. FIGS has a Growth Score of D, Value Score of F and VGM Score of F. That combination tempers the Buy signal because the Zacks Style Scores favor top-ranked stocks that also carry A or B grades. Improving execution keeps FIGS attractive for momentum-focused investors, but the premium valuation and weak value-oriented scores argue for selectivity rather than an unconditional buy case.

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

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