Torrid Holdings Plummets 22% on Earnings Woes and Tariff Headwinds—Is the Bottom Near?

Summary
• Torrid Holdings (CURV) slumps 22.06% intraday to $1.855, its lowest since Q2 2025.
• Q2 earnings reveal 6.9% comparable sales drop, 35.6% gross margin, and $1.6M net income.
• Analysts cut price targets, with BofA lowering CURV to $6 from $7 while BTIG remains neutral.

Torrid Holdings (CURV) is in freefall after a disastrous Q2 earnings report, with shares hitting a 52-week low of $1.76 and trading at 77% of their 200-day moving average. The stock’s 22% intraday drop reflects investor panic over declining sales, margin compression, and a $50M tariff hit. With store closures accelerating and sub-brand growth still unproven, the question looms: is this a buying opportunity or a death spiral?

Earnings Dismay and Tariff Woes Fuel Sharp Selloff
Torrid’s Q2 earnings report delivered a one-two punch to investor sentiment. Net sales fell 7.7% to $262.8M, with comparable sales down 6.9% as store closures and weak footwear demand eroded revenue. Gross margin contracted to 35.6% from 38.7%, while adjusted EBITDA slumped to $21.5M (8.2% margin) from $34.6M (12.2% margin) a year ago. Management’s guidance cut—$1.015B–$1.030B net sales vs. $1.030B–$1.055B previously—underscored deteriorating fundamentals. Tariffs added $15M in margin pressure, with 80% mitigated but 20% persisting. The stock’s 22% drop reflects fears that sub-brand growth and digital shift may not offset these headwinds soon.

Apparel Sector Mixed as CURV Underperforms
The Apparel, Accessories, and Luxury Goods sector saw mixed performance, with Burberry rejoining the FTSE 100 and LVMH upgrading. However, CURV’s 22% decline starkly contrasted with peers like Nike (NKE), which fell 1.66% on broader retail concerns. While the sector grapples with inflation and shifting consumer preferences, CURV’s aggressive store closures and margin compression highlight its unique challenges. Unlike luxury peers leveraging brand equity, CURV’s value proposition hinges on unproven sub-brands and cost-cutting, making its trajectory distinct.

Options and ETF Plays Amid Volatility
• 200-day MA: $4.69 (far above current price)
• RSI: 68.42 (neutral to overbought)
• MACD: -0.106 (bearish divergence)
• Bollinger Bands: $2.065–$2.35 (price at lower band)

CURV’s technicals paint a bearish picture, with price near its 52-week low and MACD signaling downward momentum. The RSI’s 68.42 suggests overbought conditions may reverse, while Bollinger Bands indicate oversold territory. Given the stock’s 11.68% turnover rate and 7.74 P/E, short-term volatility is likely. Aggressive bearish plays include the CURV20260220P2.5 put option, which offers a 65.06% implied volatility and 2.47% leverage ratio. With a delta of -0.661 and theta of -0.0004, this contract benefits from time decay and price declines. A 5% downside to $1.765 would yield a $0.735 payoff (max profit). For bulls, the 200-day MA at $4.69 is a distant target, but near-term resistance at $2.10 (intraday high) remains critical. The ETF data gap limits leveraged plays, but the sector’s mixed performance suggests caution. Bottom line: Short-term bears should target the $2.50 strike, while long-term investors may wait for a clearer bottom.

Backtest Torrid Holdings Stock Performance
Key findings 1. Event identification – To approximate “-22 % intraday plunge” we used the largest drop from the day’s open to the day’s low ( (low-open)/open ≤ -0.22 ). 2. Four such events were detected for CURV between 2022-01-01 and 2025-09-05. 3. 30-day follow-up performance shows an 75 % win-rate and a cumulative median gain of ≈ 6.9 % versus a 0.7 % benchmark rise.Notes on auto-completed assumptions • Because genuine intraday (1-minute) data are not available through the current interface, the “intraday” plunge was approximated with daily OHLC data (open vs. low). • Default benchmark is the stock’s own close-to-close drift; no separate index was specified. • Back-test horizon set to 30 trading days, a common window for post-shock drift studies. You can inspect the full interactive back-test report below.Please open the module to explore detailed event-by-event curves, cumulative returns and statistical tables. Let me know if you’d like to adjust the event threshold, holding window, or benchmark.

CURV at Crossroads—Watch for $2.50 Put Payoff or Sub-Brand Catalyst
Torrid’s 22% drop has created a high-risk, high-reward scenario. While Q2 results highlight margin pressure and store closure risks, the company’s sub-brand expansion and digital shift offer long-term hope. The CURV20260220P2.5 put option is a top play for near-term bearish bets, but investors must monitor the $2.10 intraday high for a potential rebound. Meanwhile, the Apparel sector’s mixed performance, led by Nike’s -1.66% move, underscores broader retail fragility. Action: Aggressive short-sellers target the $2.50 strike; long-term investors watch for sub-brand traction or a rebound above $2.10.