Value
8.1/10data confidence 67%| Component | Sub-score |
|---|---|
| P/E | 8.3 |
| P/S | 9.7 |
| EV/EBITDA | 6.4 |
| Fwd P/E | 8.1 |
- ▸Forward P/E: 14.7x
- ▸Attractively valued
ETD · Why this verdict
Why Ethan Allen Interiors (ETD) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.1/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Ethan Allen has beaten earnings estimates in 3 of its last 4 quarters, averaging a 10% surprise, with the next report due in 25 days, flagged by the engine as a near-term catalyst edge. Earnings | The beat streak should continue, with the upcoming print beating consensus again. | →Stable |
| CounterFurniture retail earnings can be seasonally lumpy, and a death-cross technical pattern already in place suggests the market isn't yet rewarding the beat streak. | ||
The stock is flagged as attractively valued with a forward P/E of 15.0x, driving a value score of 8.0 out of 10. Valuation breakdown | Forward P/E should stay below 18x, keeping the value score above 6.0. | →Stable |
| CounterThe cheap multiple may be a value trap given declining revenue of -5% and the weak overall score of 4.8/10 flagged in the bear case. | ||
Momentum has confirmed a downtrend, with falling on-balance volume, price below the 200-day moving average, and a 30-day moving-average slope of -4.3%, driving a momentum score of just 3.7 and failing the engine's momentum gate. Momentum breakdown | Momentum score should remain below 4.5 as long as the confirmed downtrend persists. | →Stable |
| CounterThe setup is classified as a recovery pattern with MACD already improving and RSI at a neutral 46, which could mark the early stages of a bottoming process rather than continued decline. | ||
A death cross has triggered a hard block in the engine's gating system, one of three failed gates that together drive the current avoid-sizing recommendation. Engine gate (failed) | The death-cross block should persist as long as the shorter moving average remains below the longer one. | →Stable |
| CounterDeath crosses are lagging indicators and often mark a point of maximum pessimism just before a technical low, especially with the recovery setup type and improving MACD already noted. | ||
Short interest stands at an elevated 12% of float, a key risk flagged by the engine, coinciding with an unusually high implied volatility of 83%. Key risks | Short interest should decline below 8% if bearish positioning unwinds. | →Stable |
| CounterHigh short interest alongside an upcoming earnings catalyst with a 3/4 beat streak raises the possibility of a short squeeze if the print beats again, which would work in the bulls' favor rather than confirming bearish risk. | ||
Ethan Allen has beaten earnings estimates in 3 of its last 4 quarters, averaging a 10% surprise, with the next report due in 25 days, flagged by the engine as a near-term catalyst edge.
→StableEarnings
- Expectation
- The beat streak should continue, with the upcoming print beating consensus again.
CounterFurniture retail earnings can be seasonally lumpy, and a death-cross technical pattern already in place suggests the market isn't yet rewarding the beat streak.
The stock is flagged as attractively valued with a forward P/E of 15.0x, driving a value score of 8.0 out of 10.
→StableValuation breakdown
- Expectation
- Forward P/E should stay below 18x, keeping the value score above 6.0.
CounterThe cheap multiple may be a value trap given declining revenue of -5% and the weak overall score of 4.8/10 flagged in the bear case.
Momentum has confirmed a downtrend, with falling on-balance volume, price below the 200-day moving average, and a 30-day moving-average slope of -4.3%, driving a momentum score of just 3.7 and failing the engine's momentum gate.
→StableMomentum breakdown
- Expectation
- Momentum score should remain below 4.5 as long as the confirmed downtrend persists.
CounterThe setup is classified as a recovery pattern with MACD already improving and RSI at a neutral 46, which could mark the early stages of a bottoming process rather than continued decline.
A death cross has triggered a hard block in the engine's gating system, one of three failed gates that together drive the current avoid-sizing recommendation.
→StableEngine gate (failed)
- Expectation
- The death-cross block should persist as long as the shorter moving average remains below the longer one.
CounterDeath crosses are lagging indicators and often mark a point of maximum pessimism just before a technical low, especially with the recovery setup type and improving MACD already noted.
Short interest stands at an elevated 12% of float, a key risk flagged by the engine, coinciding with an unusually high implied volatility of 83%.
→StableKey risks
- Expectation
- Short interest should decline below 8% if bearish positioning unwinds.
CounterHigh short interest alongside an upcoming earnings catalyst with a 3/4 beat streak raises the possibility of a short squeeze if the print beats again, which would work in the bulls' favor rather than confirming bearish risk.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Ethan Allen combines a cheap forward multiple and a consistent earnings-beat streak with an imminent catalyst, but a confirmed technical downtrend, a death-cross hard block, and elevated short interest keep the setup on the defensive.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.8 |
| ROA | 2.6 |
| Gross margin | 8.1 |
| Op margin | 2.0 |
| Net margin | 3.4 |
| Current ratio | 6.8 |
| FCF quality | 6.2 |
| Moat | 6.1 |
| Piotroski F | 7.8 |
- ▸Strong Piotroski F-Score: 7/9
Growth
0.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 1.3 |
| EPS growth | 0.0 |
- ▸Declining revenue: -5%
Momentum
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 1.8 |
| OBV | 1.0 |
| MA position | 3.0 |
| Volume | 1.3 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -4.2%/30d — confirmed downtrend
Sentiment
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.9 |
| erm sentiment | 5.0 |
Insider
7.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 9.5 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.6 |
| quality rank | 5.8 |
| growth rank | 3.1 |
- ▸Conservative debt levels
Technical
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.3 |
| support resistance | 8.2 |
| 52w position | 4.3 |
Risk (lower is worse)
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.9 |
| days to cover | 5.9 |
| volatility | 3.4 |
| put call | 9.8 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 7.0 |
| debt equity | 9.0 |
- ▸High IV: 83%
- ▸Above max pain $18
Catalyst
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 7.5 |
| dividend safety | 5.5 |
- ▸Strong earnings: 3B/1M
- ▸Dividend: 7.2%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:22d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:2.3<4.5
- ASYMMETRY:-0.5=NEGATIVE
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
-0.53
Upside
-3.9%
Downside
7.3%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 22d with 3/4 beat streak
SuitabilityAggressive — MCap $0.5B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.1 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.1) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:2.3<4.5, ASYMMETRY:-0.5=NEGATIVE, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is -0.53 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.1, Insider at 7.2, and Technical at 6.6; the weakest are Growth at 0.7, Momentum at 2.3, and Quality at 5.1. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of -0.53 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Streak With Catalyst
Trip ifEPS surprise falls below 0% at the next report (2026-07-29 print).
- P2Cheap Forward Multiple
Trip ifForward P/E rises above 20x from the current 15.0x.
- P3Confirmed Downtrend Momentum Failure
Trip ifMomentum score rises above 4.5 from the current 3.7.
- P4Death Cross Hard Block
Trip ifMomentum score rises above 4.5 from the current 3.7, indicating the death cross has reversed into a golden cross.
- P5Elevated Short Interest And Iv
Trip ifShort interest rises above 18% of float from the current 12%.