Bear of the Day: Bassett Furniture (BSET)

Bassett Furniture Industries, Inc. BSET is in a restructuring mindset as it waits for furniture demand to pick up. Analysts have been cutting estimates on this Zacks Rank #5 (Strong Sell) over the last 30 days.

Bassett Furniture Industries operates 86 company and licensee-owned stores in the United States that sell home furnishings, including custom furniture design, free in-home design visits, and coordinated decorating accessories. It sells about 60% of its products through the stores but it also has a large traditional wholesale business with more than 1,000 open market accounts.

The wholesale business, including the Lane Venture outdoor brand, also services general furniture stores and a growing number of interior design firms.

Additionally, Bassett sells directly to consumers on its website.

Bassett has been in the business of designing and building furniture for 120 years. 75% of what Bassett sells is built, finished and upholstered in the USA.

Bassett Missed on the Fiscal Fourth Quarter 2025 Results

On Feb 4, 2026, Bassett reported its fiscal fourth quarter 2025 results and missed on the Zacks Consensus by $0.07. Earnings were $0.23 compared to the Consensus of $0.30.

It was the first earnings miss in five quarters.

However, even though the company has talked about a challenging retail environment, revenue rose 5.1% year-over-year to $88.7 million. Retail sales were up 7.9% to $57.3 million.

The company has benefited from its restructuring strategy. Selling, general and administrative expenses (SG&A) were 53.2% of sales, 60 basis points lower than the prior year. This reflected benefits from the prior year’s restructuring plan and on-going cost containment activities coupled with greater leverage of fixed costs from higher sales levels.

“Our well-defined strategic plan for 2026 is designed to grow and take market share in an environment where housing activity is projected to remain slow and discretionary demand has moderated,” said Rob Spilman, CEO.

In a bright spot in the quarter, Bassett Casegoods, which is the wood business, saw sales up over 50% after it made a commitment to drive innovation.

It’s upholstery business also continued to be solid.

The company also recently formed the Bassett Hospitality Division and hired a leader with extensive experience selling to country clubs, senior living facilities, boutique hotels and related commercial areas.

It hopes to offer quick custom solutions from its domestic manufacturing facilities. This business will be a contributor to its wholesale business.

Analysts Cut Bassett’s Fiscal 2026 and 2027 Earnings Estimates

The analysts might have gotten too bullish about a turnaround in earnings in 2026, even though one is still expected.

Two estimates have been cut for 2026 in the last 30 days pushing the Zacks Consensus down to $1.00 from $1.09. This is still earnings growth of 33% because the company only earned $0.75 in fiscal 2025.

One estimate was also cut for 2027 in the last month, pushing down the 2027 Zacks Consensus to $1.34 from $1.39. But that is further earnings growth of 34%.

Will earnings rebound this much over the next 2 years?

Here’s what it looks like on the 5-year price, consensus and surprise chart.

Bassett Shares Lag the S&P 500 the Last 5 Years

Housing has been in a recession for three years. That has impacted the furniture industry as well.

Bassett shares have lagged the S&P 500 over the last 5 years. In 2026, they’re down another 10.4%.

However, Bassett is now a cheap stock. It trades with a forward price-to-earnings (P/E) ratio of just 14.9. A P/E under 15 is usually considered a value stock.

But with earnings expected to grow over 30% this year and next, it also has a PEG ratio, which looks at P/E divided by growth, of just 0.9. A PEG ratio under 1.0 usually means a company has both value and growth.

Bassett is also shareholder friendly. It is paying an annual dividend of $0.80, which is yielding a juicy 5.4%.

Like last year, Bassett is simply waiting for the housing market to turn around, and for the consumer to buy more furniture. Investors might want to wait on the sidelines to see if it can happen this year.

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This article originally published on Zacks Investment Research (zacks.com).

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