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1. Company Snapshot

1.a. Company Description

The Container Store Group, Inc.operates as a retailer of storage and organization products and solutions in the United States.The company operates in two segments, The Container Store and Elfa.


It provides approximately 11,000 products designed to help customers.Its merchandise category includes custom closets, such as elfa Classic, elfa Decor, Laren, and Avera branded products, as well as closet lifestyle department and wood-based products; wood-based custom home storage and organization solutions; and customized solutions for closets, garages, home offices, pantries, laundry rooms, murphy beds, and built-in wall units.In addition, the company designs, manufactures, and sells component-based shelving and drawer systems that are customizable for any area of the home comprising closets, kitchens, offices, and garages, as well as made-to-measure sliding doors in the Nordic region of Europe.


As of April 2, 2022, it operated 94 stores with an average size of approximately 25,000 square feet in 33 states and the District of Columbia.The company offers its products directly to customers through its website, responsive mobile site, and call center, as well as sells to various retailers and distributors on wholesale basis.The Container Store Group, Inc.


was founded in 1978 and is headquartered in Coppell, Texas.

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1.b. Last Insights on TCS

The Container Store Group, Inc.'s recent struggles can be attributed to a combination of factors. The company's delisting from the NYSE and subsequent Chapter 11 bankruptcy filing have created uncertainty around its future. Weak housing market conditions and inflated prices have negatively impacted the company's sales, while rising competition has made it difficult for the company to stay competitive. The failed investment from Beyond Inc. has also added to the company's woes. The recent recapitalization transaction, aimed at bolstering the company's financial position, may provide some relief, but it remains to be seen how effective it will be in driving growth and profitability.

1.c. Company Highlights

2. TCS Q3 FY '25 Earnings: A Stable Performance Amidst Macro Uncertainty

TCS reported a stable set of numbers for Q3 FY '25, with revenues growing 4.5% year-on-year in constant currency to INR 63,973 crores (USD 7,539 million). Operating margin expanded 40 basis points sequentially to 24.5%, while net income margin stood at 19.4%, resulting in a 6.4% year-on-year growth in EPS. The company's total contract value (TCV) wins were a highlight, with a strong and broad-based TCV of USD 10.2 billion.

Publication Date: Feb -09

📋 Highlights
  • Revenue Growth: Revenues grew 4.5% year-on-year in constant currency, with a 5.6% year-over-year growth in INR terms and a 3.6% year-over-year growth in USD terms.
  • Operating Margin: Operating margin stood at 24.5%, a sequential improvement of 40 basis points, while net margin was at 19.4%.
  • TOTAL CONTRACT VALUE (TCV): The company reported a strong TCV of $10.2 billion, driven by broad-based growth across various verticals, including AI and GenAI engagements.
  • CLIENT PRIORITIES: Clients are prioritizing cost optimization, business transformation, and investing in Agentic AI adoption, building robust data foundation, and taking a value chain-based approach to AI and GenAI transformation.
  • DEAL WINS: The company saw a significant increase in successful production deployment of AI, GenAI engagements, leading to greater business certainty and confidence for clients, with a mix of optimization and new projects across various verticals.

Financial Performance

The company's revenue growth was driven by a mix of optimization and new projects, including those leveraging AI and generative AI. As stated by K. Krithivasan, "We observed that customer priorities continue to remain centered around cost optimization, business transformation. GenAI and AI and Cloud Services continued to see significant growth for us this quarter." The company's operating margin expansion was also driven by a sequential improvement of 40 basis points.

Deal Wins and Pipeline

TCS reported a strong deal pipeline, with a few mega deals being worked on. According to K. Krithivasan, "The deal wins have been good across various verticals, with a mix of optimization and new projects, including those leveraging AI and generative AI." The company also expects to replace most of the revenue from the BSNL decline, which is expected to taper off in Q4 or Q1.

Valuation

Based on the current valuation metrics, the stock appears to be reasonably priced. The price-to-sales ratio (TTM) stands at 0.01, while the enterprise value over EBITDA (TTM) is -10.19. The dividend yield percentage (TTM) is 0.0%, and the free cash flow yield (TTM) is -25.44. With analyst estimates expecting a 2.4% revenue growth next year, the valuation multiples suggest that the market has already priced in the growth expectations.

Outlook

The management expressed cautious optimism for the opportunities in 2025, with early signs of recovery in discretionary spend and a strong deal pipeline. As stated by K. Krithivasan, "We are helping our customers navigate changing customer expectations, embrace digital transformation and prioritize technology modernization and sustainability solutions in an uncertain macroeconomic environment." The company expects a stronger growth in the core markets, with most verticals expected to recover in CY 25, except for auto and aerospace.

3. NewsRoom

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Tecsys Inc. (TCS:CA) Q2 2026 Earnings Call Transcript

Dec -04

Source: seekingalpha.com

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Here's why Tata Consultancy Services share price is ripe for a comeback

Nov -24

Source: invezz.com

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TCS to partner with TPG for $7B AI and data centre JV: report

Nov -20

Source: invezz.com

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Tecsys (TSE:TCS) Stock Passes Below 200-Day Moving Average – What’s Next?

Nov -19

Source: defenseworld.net

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LISTENGAGE JOINS TCS: ACQUISITION BOLSTERS SCALE AND AI EXPERTISE FOR SALESFORCE CUSTOMERS

Oct -14

Source: prnewswire.com

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Tecsys Inc. (TCS:CA) Q1 2026 Earnings Call Transcript

Sep -05

Source: seekingalpha.com

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Tecsys Inc. (TCS:CA) Annual Meeting Of Shareholders Call Transcript

Sep -04

Source: seekingalpha.com

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Best ETFs Help Investors Cut Exposure To Magnificent Seven

Aug -08

Source: investors.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.46%)

6. Segments

The Container Store

Expected Growth: 7.4%

The Container Store's growth is driven by increasing demand for home organization and storage solutions, fueled by the rise of minimalism and the need for efficient use of space. Additionally, the growing trend of remote work and the need for organized home offices also contribute to the segment's growth.

Elfa

Expected Growth: 8.5%

Growing demand for home organization and storage solutions, increasing popularity of customizable and adjustable shelving systems, and rising consumer spending on home decor and furniture are driving the growth of the Elfa shelving and storage system market.

7. Detailed Products

Storage Containers

A wide range of containers designed to store and organize items in the home, office, or garage.

Shelving and Bookcases

Customizable shelving units and bookcases to maximize storage and display space.

Closet Systems

Customizable closet organizers and systems to maximize storage and functionality.

Kitchen and Pantry Storage

Storage solutions for the kitchen and pantry, including drawer organizers and spice racks.

Desk and Office Accessories

Desk organizers, file folders, and other office accessories to improve productivity.

Garage and Laundry Storage

Storage solutions for the garage and laundry room, including shelving and cabinets.

Bed and Bath Storage

Storage solutions for the bedroom and bathroom, including under-bed storage and linen closets.

8. The Container Store Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The Container Store Group, Inc. faces moderate threat from substitutes, as customers have alternative options for storage and organization solutions.

Bargaining Power Of Customers

The Container Store Group, Inc. has a diverse customer base, reducing the bargaining power of individual customers.

Bargaining Power Of Suppliers

The Container Store Group, Inc. relies on a few large suppliers for its products, giving them moderate bargaining power.

Threat Of New Entrants

The Container Store Group, Inc. operates in a niche market with high barriers to entry, making it difficult for new entrants to compete.

Intensity Of Rivalry

The Container Store Group, Inc. operates in a competitive market with several established players, leading to high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 59.79%
Debt Cost 4.07%
Equity Weight 40.21%
Equity Cost 9.88%
WACC 6.41%
Leverage 148.71%

11. Quality Control: The Container Store Group, Inc. passed 0 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Hour Loop

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Value: 3.8

Growth: 7.1

Quality: 6.5

Yield: 0.0

Momentum: 10.0

Volatility: 0.0

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National Vision

A-Score: 4.1/10

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Barnes & Noble Education

A-Score: 3.3/10

Value: 7.4

Growth: 1.7

Quality: 2.8

Yield: 0.0

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Volatility: 1.7

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Petco

A-Score: 3.1/10

Value: 7.5

Growth: 5.1

Quality: 2.1

Yield: 0.0

Momentum: 3.0

Volatility: 1.0

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Sportsman's Warehouse

A-Score: 3.0/10

Value: 8.1

Growth: 3.6

Quality: 2.9

Yield: 0.0

Momentum: 2.5

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The Container Store

A-Score: 2.4/10

Value: 10.0

Growth: 1.3

Quality: 2.9

Yield: 0.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

2.65$

Current Price

2.65$

Potential

-0.00%

Expected Cash-Flows