FLWS

1-800-Flowers($FLWS) Major Shareholder Dumps $20M+ Into Stock Despite 50% Plunge

06/10/2025 20:58

Major shareholder Fund 1 Investments has been conducting an intensive buying campaign in 1-800-Flowers.Com ($FLWS) worth over $20 million over the past six months, drawing significant market attention. This aggressive accumulation comes as the stock has plummeted more than 50% from its July 2024 high of $11 to current levels around $5. 1-800-Flowers, a leading online floral and gift delivery service with a market capitalization of $361 million, has been facing mounting investor concerns due to recent earnings disappointments and management changes. However, the major shareholder's continuous buying spree suggests strong confidence in the company's intrinsic value. Fund 1 Investments has been purchasing $FLWS shares almost daily from January 10 to June 6, 2025. Notable transactions include a massive 605,000-share purchase for $4.83 million on February 1st and 396,000 shares for $3.02 million on January 30th. The buying range spans from $4.42 to $8.85 per share, indicating aggressive accumulation at what the fund perceives as deeply discounted levels. Founded in 1976, 1-800-Flowers operates as an online floral and gifting specialist with a portfolio including 1-800-Flowers.com, Harry & David, Cheryl's Cookies, and The Popcorn Factory. The business exhibits significant seasonal patterns, with Valentine's Day, Mother's Day, and Christmas driving major revenue spikes. However, the company has struggled with consecutive quarters of revenue declines and earnings misses. The most recent Q1 2025 results (ended March 31) showed an adjusted loss of $2.80 per share, dramatically worse than the expected 34-cent loss, while revenue fell 12.6% to $331.45 million, missing analyst estimates of $365.02 million. This underperformance reflects a combination of weakened consumer sentiment, inflationary pressures, and intensified competition in the online gifting market. Management changes add another layer of complexity. In May 2025, founder and CEO Jim McCann announced his planned departure amid declining sales. McCann's exit after decades of leadership marks a significant transition for the company, with digital transformation acceleration and operational efficiency improvements expected to be key priorities under new leadership. Fund 1 Investments' persistent buying pattern suggests conviction in the company's long-term potential despite near-term headwinds. The timing and scale of purchases indicate a classic value investing approach—accumulating shares when market sentiment is overly pessimistic and prices appear historically depressed. 1-800-Flowers' business model retains fundamental strengths including a nationwide delivery network, diversified brand portfolio, and consistent consumer demand for special occasion gifting. The seasonal nature of the business also means current performance struggles may not be permanent. Industry experts view Fund 1 Investments' buying campaign as a textbook bottom-fishing strategy. When stocks trade significantly below intrinsic value, investors with conviction in the underlying business fundamentals often accumulate aggressively. The scale of investment at the major shareholder level suggests thorough analysis of the company's financial position and future prospects. Key factors to monitor include the selection of a new CEO, strategic pivots under fresh leadership, and performance during the crucial holiday season, which typically accounts for a significant portion of annual revenue. The upcoming Q4 results will serve as a critical indicator of the company's trajectory under new management. Analysts maintain a 'Buy' rating on $FLWS with a 12-month price target of $10.50, implying approximately 100% upside potential from current levels. Combined with Fund 1 Investments' continuous accumulation, this suggests the current share price may not fully reflect the company's intrinsic value.

You can receive notifications when news is published.