I am assigning Warby Parker (NYSE: WRBY) a negative risk/reward rating based on its elevated valuation, declining customer unit economics, special risk factors, and industry-wide e-commerce friction. Negative rating aside, I believe Warby Parker has the potential to be a secular growth stock with substantial upside potential once the above concerns are rectified. In this article I breakdown Warby Parker’s performance across its financial statements and key business metrics in order to formulate an investment strategy for the shares.
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