The Honest Company, Inc.

HNST

Consumer CyclicalSpecialty RetailNASDAQ

$3.64

Market Cap: $400.69M

The Honest Company, Inc. (HNST) Valuation Summary

Updated May 11, 2026 05:39

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Revenue DCF 5Y	$0.30 – $6.04	$1.32	-63.7%
Revenue DCF 10Y	$0.27 – $6.67	$1.75	-51.8%
▸ Trading Multiples
EV/Revenue	$2.36 – $7.75	$2.71	-25.5%

Valuation History

DCF Analysis

The Honest Company, Inc. (HNST) Revenue DCF (5Y)

REVENUE DCF FAIR VALUE

$1.75

Market Price

$3.64

Upside / Downside

-51.8%

Verdict

Overvalued

Using a Revenue DCF model with operating margin convergence from -5.0% to a target of 7.7% over 5 years, discounted at a WACC of 8.2%, The Honest Company, Inc. (HNST) has an intrinsic value of $1.75 per share (range: $0.27 – $6.67).

Key Assumptions

Current Operating Margin

-5.0%

Target Operating Margin

7.7%

WACC

8.2%

Terminal Growth Rate

3.0%

Historical CapEx/Rev

0.3%

Target CapEx/Rev

6.0%

D&A/Revenue

2.4%

Tax Rate

21.0%

Operating margin fades linearly from the current level to the industry target over the 5-year projection. CapEx intensity fades from the historical average to a maintenance level (D&A × 1.5). Tax is only applied when operating income is positive (NOL shield).

Margin Convergence Projection

USD in millions. Mid-year discounting convention.

Year	Revenue	Growth	Op Margin	Op Income	NOPAT	D&A	CapEx	ΔNWC	FCFF	PV(FCFF)
2026	310	-16.5%	-2.4%	-8	-8	7	(3)	0	-3	-3
2027	327	5.5%	0.1%	0	0	8	(5)	5	-2	-2
2028	347	6.0%	2.6%	9	7	8	(7)	6	3	2
2029	360	3.9%	5.2%	19	15	8	(9)	4	10	7
2030	374	3.9%	7.7%	29	23	9	(12)	4	16	11
2031	388	3.8%	7.7%	30	24	9	(15)	4	14	9
2032	402	3.6%	7.7%	31	25	9	(17)	4	13	8
2033	416	3.5%	7.7%	32	25	10	(20)	4	11	6
2034	430	3.3%	7.7%	33	26	10	(23)	4	9	5
2035	444	3.1%	7.7%	34	27	10	(27)	4	7	3

Enterprise Value Bridge

Sum of PV(FCFF)46

Terminal Value (Gordon Growth at 3.0%)136

PV of Terminal Value64

Enterprise Value110

(–) Net Debt-85

Equity Value195

(÷) Shares Outstanding111

Fair Value per Share$1.75

Sensitivity Analysis — WACC × Target Operating Margin

WACC \ Target Op. Margin	1.7%	4.7%	7.7%	10.7%	13.7%
6.2%	$0	$1	$2	$5	$7
7.2%	$0	$1	$2	$4	$5
8.2%	$0	$1	$2	$3	$4
9.2%	$0	$1	$2	$3	$4
10.2%	$0	$1	$1	$2	$3

Current price: $3.64. Green = undervalued, Red = overvalued.

Working Capital Assumption

Net Working Capital is modeled at 29.4% of revenue (historical average of receivables + inventory − payables). Changes in NWC (ΔNWC) are computed year-over-year and subtracted from free cash flow.

The Honest Company, Inc. (HNST) Revenue DCF (5Y)

REVENUE DCF FAIR VALUE

$1.32

Market Price

$3.64

Upside / Downside

-63.7%

Verdict

Overvalued

Key Assumptions

Current Operating Margin

-5.0%

Target Operating Margin

7.7%

WACC

8.2%

Terminal Growth Rate

3.0%

Historical CapEx/Rev

0.3%

Target CapEx/Rev

6.0%

D&A/Revenue

2.4%

Tax Rate

21.0%

Margin Convergence Projection

USD in millions. Mid-year discounting convention.

Year	Revenue	Growth	Op Margin	Op Income	NOPAT	D&A	CapEx	ΔNWC	FCFF	PV(FCFF)
2026	310	-16.5%	-2.4%	-8	-8	7	(5)	0	-5	-5
2027	327	5.5%	0.1%	0	0	8	(9)	5	-6	-5
2028	347	6.0%	2.6%	9	7	8	(13)	6	-3	-3
2029	360	3.9%	5.2%	19	15	8	(18)	4	2	1
2030	374	3.9%	7.7%	29	23	9	(22)	4	5	4

Enterprise Value Bridge

Sum of PV(FCFF)-7

Terminal Value (Gordon Growth at 3.0%)99

PV of Terminal Value70

Enterprise Value62

(–) Net Debt-85

Equity Value147

(÷) Shares Outstanding111

Fair Value per Share$1.32

Sensitivity Analysis — WACC × Target Operating Margin

WACC \ Target Op. Margin	1.7%	4.7%	7.7%	10.7%	13.7%
6.2%	$0	$1	$2	$4	$6
7.2%	$0	$1	$2	$3	$5
8.2%	$0	$1	$1	$3	$4
9.2%	$0	$1	$1	$2	$3
10.2%	$0	$1	$1	$2	$3

Current price: $3.64. Green = undervalued, Red = overvalued.

Working Capital Assumption

Net Working Capital is modeled at 29.4% of revenue (historical average of receivables + inventory − payables). Changes in NWC (ΔNWC) are computed year-over-year and subtracted from free cash flow.

Trading Multiples

Fair Value

$2.71

Market Price

$3.64

Upside / Downside

-25.5%

Verdict

Overvalued

Using the industry peer median EV/Revenue multiple (trailing + forward), The Honest Company, Inc. (HNST) has a fair value of $2.71 based on 10 comparable companies in the Specialty Retail industry.

EV/Revenue Valuation — Specialty Retail

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
The Honest Company, Inc.HNST	405	0.9x	0.9x
Arko Corp.ARKO	771	0.6x	0.6x
Caleres, Inc.CAL	456	0.5x	0.5x
Hyliion Holdings Corp.HYLN	439	120.9x	112.0x
Zumiez Inc.ZUMZ	425	0.5x	0.6x
Dine Brands Global, Inc.DIN	368	2.1x	2.3x
Barnes & Noble Education, Inc.BNED	361	0.4x	0.4x
Haverty Furniture Companies, Inc.HVT	357	0.6x	0.6x
Lands' End, Inc.LE	355	0.4x	0.4x
Portillo's Inc.PTLO	315	1.8x	1.8x
Innoviz Technologies Ltd.INVZ	157	3.9x	3.7x
Industry Median		0.6x	0.6x
(*) Revenue		371	375
= Enterprise Value		215	218
(-) Net Debt		-85	-85
Equity Value		300	303
(/) Outstanding shares		111	111
Fair Price		$3	$3

Selected Fair Value (avg of trailing + forward)

$2.71

-25.5%

Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.

Model

Range

Fair Value

Upside

▸ Discounted Cash Flow

Revenue DCF 5Y

$0.30 – $6.04

$1.32

-63.7%

Revenue DCF 10Y

$0.27 – $6.67

$1.75

-51.8%

▸ Trading Multiples

EV/Revenue

$2.36 – $7.75

$2.71

-25.5%

DCF Analysis

The Honest Company, Inc. (HNST) Revenue DCF (5Y)

REVENUE DCF FAIR VALUE

$1.75

Market Price

$3.64

Upside / Downside

-51.8%

Verdict

Overvalued

Key Assumptions

Current Operating Margin

-5.0%

Target Operating Margin

7.7%

WACC

8.2%

Terminal Growth Rate

3.0%

Historical CapEx/Rev

0.3%

Target CapEx/Rev

6.0%

D&A/Revenue

2.4%

Tax Rate

21.0%

Margin Convergence Projection

USD in millions. Mid-year discounting convention.

Year	Revenue	Growth	Op Margin	Op Income	NOPAT	D&A	CapEx	ΔNWC	FCFF	PV(FCFF)
2026	310	-16.5%	-2.4%	-8	-8	7	(3)	0	-3	-3
2027	327	5.5%	0.1%	0	0	8	(5)	5	-2	-2
2028	347	6.0%	2.6%	9	7	8	(7)	6	3	2
2029	360	3.9%	5.2%	19	15	8	(9)	4	10	7
2030	374	3.9%	7.7%	29	23	9	(12)	4	16	11
2031	388	3.8%	7.7%	30	24	9	(15)	4	14	9
2032	402	3.6%	7.7%	31	25	9	(17)	4	13	8
2033	416	3.5%	7.7%	32	25	10	(20)	4	11	6
2034	430	3.3%	7.7%	33	26	10	(23)	4	9	5
2035	444	3.1%	7.7%	34	27	10	(27)	4	7	3

Enterprise Value Bridge

Sum of PV(FCFF)46

Terminal Value (Gordon Growth at 3.0%)136

PV of Terminal Value64

Enterprise Value110

(–) Net Debt-85

Equity Value195

(÷) Shares Outstanding111

Fair Value per Share$1.75

Sensitivity Analysis — WACC × Target Operating Margin

WACC \ Target Op. Margin	1.7%	4.7%	7.7%	10.7%	13.7%
6.2%	$0	$1	$2	$5	$7
7.2%	$0	$1	$2	$4	$5
8.2%	$0	$1	$2	$3	$4
9.2%	$0	$1	$2	$3	$4
10.2%	$0	$1	$1	$2	$3

Current price: $3.64. Green = undervalued, Red = overvalued.

Working Capital Assumption

Net Working Capital is modeled at 29.4% of revenue (historical average of receivables + inventory − payables). Changes in NWC (ΔNWC) are computed year-over-year and subtracted from free cash flow.

Trading Multiples

Fair Value

$2.71

Market Price

$3.64

Upside / Downside

-25.5%

Verdict

Overvalued

Using the industry peer median EV/Revenue multiple (trailing + forward), The Honest Company, Inc. (HNST) has a fair value of $2.71 based on 10 comparable companies in the Specialty Retail industry.

EV/Revenue Valuation — Specialty Retail

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
The Honest Company, Inc.HNST	405	0.9x	0.9x
Arko Corp.ARKO	771	0.6x	0.6x
Caleres, Inc.CAL	456	0.5x	0.5x
Hyliion Holdings Corp.HYLN	439	120.9x	112.0x
Zumiez Inc.ZUMZ	425	0.5x	0.6x
Dine Brands Global, Inc.DIN	368	2.1x	2.3x
Barnes & Noble Education, Inc.BNED	361	0.4x	0.4x
Haverty Furniture Companies, Inc.HVT	357	0.6x	0.6x
Lands' End, Inc.LE	355	0.4x	0.4x
Portillo's Inc.PTLO	315	1.8x	1.8x
Innoviz Technologies Ltd.INVZ	157	3.9x	3.7x
Industry Median		0.6x	0.6x
(*) Revenue		371	375
= Enterprise Value		215	218
(-) Net Debt		-85	-85
Equity Value		300	303
(/) Outstanding shares		111	111
Fair Price		$3	$3

Selected Fair Value (avg of trailing + forward)

$2.71

-25.5%