Research Report Advises Avoiding LKQ, Lovesac, Funko Stocks on Valuation Worries

A StockStory analysis released June 5, 2026, warns investors against holding LKQ (NASDAQ:LKQ), Lovesac (NASDAQ:LOVE), and Funko (NASDAQ:FNKO) as the consumer discretionary sector struggles. The industry returned just 1.7% over the past six months, trailing the S&P 500 by 8.3 percentage points amid economic headwinds. LKQ, a vehicle parts distributor with a $6.44 billion market cap, trades at 8.3 times forward earnings. Lovesac, a $239 million modular furniture brand, sits at 8.6 times forward EV-to-EBITDA. Funko, a pop-culture collectibles maker valued at $295 million, trades at a steep 208.8 times forward earnings. The report highlights these elevated multiples as key risks in a softening consumer environment.