Warby Parker Inc. (WRBY): A Bull Case Theory

Company Overview - Warby Parker Inc. provides eyewear products in the United States and Canada, focusing on higher-income customers and essential vision correction needs [2] Market Conditions - The company is navigating a softer consumer backdrop with relative resilience, particularly among older and progressive-lens customers, while younger consumers show more pronounced weakness [2] - This pressure is expected to be temporary, with vision care benefiting from an anticipated 35% increase in tax refunds, amounting to approximately $125 billion in one-time stimulus between February and May 2026 [3] Sales and Revenue Growth - Comparable sales trends have improved, with productivity-backed comps showing consistent two-year acceleration, and retail productivity reaching record levels [3] - A growing in-network insurance footprint, including the addition of Versant, provides a near-term revenue tailwind, especially in the fourth quarter when vision benefits are typically utilized [4] Margin and Cost Structure - Margins are expected to improve as tariff pressures ease and fixed costs leverage, despite current gross margin compression due to investments in optometrists and eye exam capacity [5] - Incremental economics remain attractive due to the low unit cost of frames and lenses, with SG&A expected to leverage meaningfully as non-marketing spend remains modest [5] Strategic Initiatives - Warby Parker is emerging as a leader in intelligent eyewear through partnerships with Google and Samsung, supported by significant capital commitments and product development [6] - The current stock valuation offers strong downside support and a compelling upside scenario driven by improving comps, margin expansion, AI-enabled products, and upcoming tax-related demand catalysts [6]