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Plus (aka World Market) operates 258 stores
nationwide that offer an eclectic mix of everything from exotic (but
economical) furnishings to cookware and foods from around the world.
time CPWM hit the Zacks Rank #1 buy list on January
24, 2011 it was a $12 dollar stock; fast forward less than
two months and the shares are
up 50%, now trading close to $18 after hitting a 5 year high of $18.66.
January my focus was on World Market’s unique positioning, growth
expansion. I also saw analysts moving their estimates higher ahead of
earnings report which can be one of the best indicators if a stock is
these factors combined made CPWM a solid Zacks Rank Buy candidate.
The retailer delivered those anticipated bullish
results on March 22nd, beating Zacks Consensus Estimates and sending
shares higher. The question now is
whether this momentum can continue?
store sales for the quarter increased 7.6% on top of a 7.7% increase
for the same
quarter last year.
store customer count for the quarter increased 3.4% and same store
ticket increased 4.1%.
sales for fiscal 2011 were $963.8 million, a 5.2% increase compared to
million for fiscal 2010.
income from continuing operations for fiscal 2011 was $17.7 million
$4.7 million for fiscal 2010.
per diluted share from continuing operations for fiscal 2011 was $0.76
to $0.21 last year.
- They had no
outstanding borrowings as of January 28, 2012 compared to $25.4 million
outstanding borrowings last year.
EBITDA from continuing operations for fiscal 2011 was $51.3 million
$39.5 million for fiscal 2010.
The company is executing their plan to grow their total
number of stores to 500, but they are going to slow things down a bit
first half of 2012 until the economy shows improvement.
said, Cost Plus is expecting a 6% to 8% increase in year over year,
sales for Q1 2012 and a reduction in their Q1 net loss from continuing
to between -$0.03 and -$0.07 per diluted share compared to -$0.13 per
is targeting to open five to ten new stores and
the outlook includes an estimate of eight new stores, including two
relocations, compared to five store closures and one relocation during
In the past week alone since the report, we saw two
analysts revised their current quarter’s earnings estimates up as well
as 1 upward
revisions to next quarter’s results, 5 upward revisions for current
next year’s estimates got a boost from 4 analysts. There was
only one negative revision from one
analyst for next quarter’s results.
are for Cost Plus to lose 0.05 this quarter.
Of the 6 analysts that cover the
furniture company, the consensus is for the company to grow earnings by
in the current year (FY2012) and 11.24% in FY2013.
terms of the magnitude of analyst estimate
trends, we are seeing all of the consensus estimates higher than they
days ago, except for next quarter’s estimate.
Plus beat estimates by 4% last quarter and has averaged an earnings
20.17% over the past year.
Performance & Technical’s
remains in a bullish pattern, but is seeing some profit taking after rallying
to new highs on the bullish report. Look
for $15.25 to be an area of strong support for the stock.
Below that the 50 day moving average remains
a level that Cost Plus hasn’t broken for more than a day since October
The 50 day moving average currently stands at $14.29.
the stock can hold the $17.15 level, which is the bottom of most recent
the shares should continue their march higher.
Plus has outpaced the S&P 500 by 73% over the past year and
almost 67% over
the past 3 months alone. The recent run
and subsequent gap on their earnings report enabled CPWM to beat the
26% over the past month!
A Levy is the Momentum Stock Strategist for Zacks.com. He is also the
charge of the market-beating Zacks
Whisper Trader Service.