Bob's Discount Furniture IPO: "discount" furniture retailer goes public

Preliminary trading in shares of Bob's Discount Furniture, a budget furniture and bedding retailer, began on the Freedom customer trading system. The company's strategy is to sell furniture cheaper than competitors in the discounter segment, Bloomberg reported. Later on Feb. 5, Bob's Discount Furniture securities will appear on the New York Stock Exchange under the ticker BOBS.

Bob's Discount Furniture, in which Bain Capital invested, successfully raised $330.7 million in an IPO. The company placed 19.5 million shares at $17 per paper, which corresponds to the lower boundary of the previously announced price range ($17-19). Based on the results of the IPO, the value of the entire company can be estimated at $2.22 billion, writes Reuters.

The listing was organized by JPMorgan, Morgan Stanley, RBC Capital Markets, UBS Investment Bank, BofA Securities, Evercore ISI and Goldman Sachs, among others.

The company has been under the control of private equity funds for about 20 years, Reuters specifies. In 2014, Bain Capital acquired Bob's from funds KarpReilly and Apax Partners. The funds raised from the IPO will be used to reduce the debt load after the payment of a $423 million dividend to Bain Capital.

Home goods retailer Bob's Discount Furniture was founded in 1991 in Manchester, Connecticut, Reuters reported. Since then, the company has grown into one of the largest furniture chains in the United States. As of Sept. 28, 2025, it had 206 stores in 26 states, with plans to expand to more than 500 locations by 2035.

Bob's sells discounted furniture: according to the company's own estimates, its prices are on average 10% lower than competitors' and up to 25% lower than the original cost without discounts, The Wall Street Journal points out. The sale includes bedroom and dining sets, recliners, table lamps and other items.

The company has been growing steadily and making profits, but is sensitive to duties because most of its products are sourced from overseas, Reuters noted. By the end of fiscal 2024, Bob's shifted its main production from China, and one of the key procurement markets was Vietnam, which accounts for about 63% of the cost of production, according to the prospectus for the IPO, filed with the U.S. Securities and Exchange Commission (SEC). The company also purchases goods in Thailand, Malaysia and Cambodia.

"Following the rejection of shipments from China, investors are likely to perceive tariff risks for Bob's Discount Furniture as largely removed," IPOX Vice President Cathie Liu told Reuters in a commentary. - 'Duties in other regions and logistics costs remain, but stock fluctuations will likely have more to do with market sentiment than actual pressure on the company's earnings'(quoted by Reuters)."

The company's revenue for the nine months ended September 28, 2025, rose 20% to $1.72 billion, while net income increased 64% to $80.7 million, according to the prospectus. By comparison, a year earlier, revenue was $1.43 billion and net income was $49.3 million.

Despite inflationary pressures and tariff risks in the home furnishings market, the company reported comparable sales growth of 10.5% for the nine months - mainly driven by retail stores.

WAITING FOR THE FREEDOM ANALYST

The company is earning and growing revenue, it has a good reserve of free cash and low investment costs, which allows it to actively expand the network, said IPO Edge analyst Donovan Jones at Seeking Alpha. Meanwhile, gross margins are generally holding up but gradually declining, and operating cash flow is declining despite sales growth. This suggests risks in strategy execution and pressure on profitability, Jones said.

The main risks for the company are related to its dependence on foreign suppliers, primarily from Vietnam and other Southeast Asian countries, as well as possible changes in duties, the analyst says. Additionally, the business is under pressure from the focus on offline sales and the high sensitivity of demand for furniture to the state of the economy.

Bob's Discount Furniture is hitting the market amid a wave of IPOs of companies in private equity portfolios, Bloomberg notes. For example, Blackstone-backed compressor maker Copeland filed confidential listing documents, and aerospace company York Space Systems from AE Industrial Partners raised $629 million in an IPO on Jan. 29.

Uncertainty around the sustainability of U.S. consumer demand, the Donald Trump administration's tariffs and high interest rates have held back IPOs of consumer-oriented companies - including retailers and apparel makers - in recent years. Because of this, the sector has lagged behind other industries, Bloomberg emphasizes .

Freedom Finance analyst Alem Bektemirov says that at the offering price of $17, the company's stock growth potential is 10%. In his opinion, the main risks for the business are market competition and dependence on foreign suppliers.

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Freedom's clients will be able to get access to shares of Bob's Discount Furniture before the opening of the main exchange session. Trading will begin in the early pre-market format 2-3 hours before the opening of the U.S. exchanges (from 15:30-16:30 Astana time). To participate click on ticker BOBS.

This article was AI-translated and verified by a human editor