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Is FIGS a Smart Investment to Add to Your Portfolio? By StockNews

© Reuters. Is FIGS a Smart Investment to Add to Your Portfolio?

Even though there was little market hype around medical scrubs, face masks, and shields maker FIGS, Inc.’s (FIGS) stock market debut in May 2021, the stock’s price soared nearly 29% in its first trading session. But because COVID-19 pandemic-related heightened demand for healthcare apparel is expected to decline in the near term, the question is can the stock continue advancing? Let’s find out.Direct-to-consumer (DTC) healthcare apparel and lifestyle company FIGS, Inc. (FIGS) administered a stellar IPO on May 27, 2021, with the stock’s price soaring nearly 29% that day, bringing the company’s valuation to $4.57 billion. The stock has rallied 14.3% over the past month to close yesterday’s trading session at $38.85, driven primarily by investors’ optimism regarding FIGS’ growth prospects in the relatively inelastic healthcare apparel market. FIGS is based in Santa Monica, Calif.

However, even though FIGS has successfully carved out a market niche for itself, it faces competition from Amazon.com, Inc.’s (NASDAQ:) Amazon Essentials brand and Jaanuu, Inc., among others.

So, with several companies in the same field adopting or accelerating their digital business models, FIGS could face stiff competition over the long run. So, we think the stock’s near-term prospects look uncertain.

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