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National Vision (EYE) Q3 Earnings Top Mark, Margins Down
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National Vision Holdings, Inc. (EYE - Free Report) delivered adjusted earnings per share (EPS) of 15 cents for the third quarter of 2022, reflecting a significant 60.5% year-over-year decline from the year-ago reported figure of 45 cents. The figure, however, surpassed the Zacks Consensus Estimate of 8 cents.
The adjustment excludes the impact of certain non-recurring charges like stock compensation expense, asset impairment and amortization of acquisition intangibles, among others.
GAAP EPS for the quarter was 15 cents compared with the year-ago earnings per share of 45 cents.
Revenues in Detail
Revenues in the third quarter totaled $499.2 million, missing the Zacks Consensus Estimate by 0.1%. The top line declined 3.6% from the year-ago number. The decline in net revenues is attributable to the macroeconomic headwinds and constraints to eye exam capacity.
In the third quarter, comparable store sales declined 8%. Adjusted comparable store sales plunged 8.1%. National Vision opened 18 new stores to reach a store count of 1,332 at the end of the quarter. Overall, the store count grew 5.5% year over year.
National Vision Holdings, Inc. Price, Consensus and EPS Surprise
The company plans to open at least 80 stores in 2022 and currently has a solid pipeline of specific locations for 2022 and 2023.
Margins
Gross profit in the reported quarter was $266.4 million, down 8.6% from the prior-year quarter. The gross margin of 53.4% contracted 292 basis points (bps).
Selling, general and administrative expenses rose 3.1% to $225 million. Adjusted operating margin was 8.3%, down 587 bps year over year.
Financial Position
National Vision exited the third quarter of 2022 with cash and cash equivalents of $256.2 million compared with $305.8 million at the end of Q2.
Cumulative net cash flow from operating activities at the end of the quarter was $121.3 million compared with $233.8 million a year ago.
2022 Outlook
For 2022, net revenues are reiterated in the range of $1.99-$2.02 billion.
Adjusted earnings per share are estimated in the band of 65-77 cents (unchanged). The Zacks Consensus Estimate for the same is currently pegged at 69 cents.
Adjusted comparable store sales to decline in the range of 6.5%-8%, unchanged from the earlier projected range of 4%-7% decline.
Our Take
National Vision reported better-than-expected earnings and a revenue miss for the third quarter of 2022. On a year-over-year basis, the company reported a significant decline in those numbers. According to the company, it is facing demand headwinds across its network of stores, given the current macro environment, as well as a supply challenge in a smaller subgroup of stores due to the constraints on eye exam capacity. Contraction of both margins on escalating expenses is discouraging.
On a positive note, the company’s third-quarter results benefited from new store openings in America's Best and Eyeglass World brands.
Zacks Rank & Key Picks
National Vision currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are AMN Healthcare Services, Inc. (AMN - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
AMN Healthcare, carrying a Zacks Rank #2 (Buy), reported third-quarter 2022 adjusted EPS of $2.57, which beat the Zacks Consensus Estimate by 10.3%. Revenues of $1.14 billion outpaced the consensus mark by 3.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AMN Healthcare has an estimated long-term growth rate of 3.3%. AMN’s earnings surpassed estimates in all the trailing four quarters, the average being 10.9%.
Medpace Holdings, sporting a Zacks Rank #1, reported third-quarter 2022 EPS of $2.05, which beat the Zacks Consensus Estimate by 39.5%. Revenues of $383.7 million outpaced the consensus mark by 8.1%.
Medpace Holdings has an estimated growth rate of 44.9% for the full-year 2022. MEDP’s earnings surpassed estimates in all the trailing four quarters, the average being 22%.
Merit Medical, carrying a Zacks Rank #2, reported third-quarter 2022 adjusted EPS of 64 cents, which beat the Zacks Consensus Estimate by 20.8%. Revenues of $287.2 million outpaced the consensus mark by 5.2%.
Merit Medical has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average being 25.4%.
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National Vision (EYE) Q3 Earnings Top Mark, Margins Down
National Vision Holdings, Inc. (EYE - Free Report) delivered adjusted earnings per share (EPS) of 15 cents for the third quarter of 2022, reflecting a significant 60.5% year-over-year decline from the year-ago reported figure of 45 cents. The figure, however, surpassed the Zacks Consensus Estimate of 8 cents.
The adjustment excludes the impact of certain non-recurring charges like stock compensation expense, asset impairment and amortization of acquisition intangibles, among others.
GAAP EPS for the quarter was 15 cents compared with the year-ago earnings per share of 45 cents.
Revenues in Detail
Revenues in the third quarter totaled $499.2 million, missing the Zacks Consensus Estimate by 0.1%. The top line declined 3.6% from the year-ago number. The decline in net revenues is attributable to the macroeconomic headwinds and constraints to eye exam capacity.
In the third quarter, comparable store sales declined 8%. Adjusted comparable store sales plunged 8.1%. National Vision opened 18 new stores to reach a store count of 1,332 at the end of the quarter. Overall, the store count grew 5.5% year over year.
National Vision Holdings, Inc. Price, Consensus and EPS Surprise
National Vision Holdings, Inc. price-consensus-eps-surprise-chart | National Vision Holdings, Inc. Quote
The company plans to open at least 80 stores in 2022 and currently has a solid pipeline of specific locations for 2022 and 2023.
Margins
Gross profit in the reported quarter was $266.4 million, down 8.6% from the prior-year quarter. The gross margin of 53.4% contracted 292 basis points (bps).
Selling, general and administrative expenses rose 3.1% to $225 million. Adjusted operating margin was 8.3%, down 587 bps year over year.
Financial Position
National Vision exited the third quarter of 2022 with cash and cash equivalents of $256.2 million compared with $305.8 million at the end of Q2.
Cumulative net cash flow from operating activities at the end of the quarter was $121.3 million compared with $233.8 million a year ago.
2022 Outlook
For 2022, net revenues are reiterated in the range of $1.99-$2.02 billion.
Adjusted earnings per share are estimated in the band of 65-77 cents (unchanged). The Zacks Consensus Estimate for the same is currently pegged at 69 cents.
Adjusted comparable store sales to decline in the range of 6.5%-8%, unchanged from the earlier projected range of 4%-7% decline.
Our Take
National Vision reported better-than-expected earnings and a revenue miss for the third quarter of 2022. On a year-over-year basis, the company reported a significant decline in those numbers. According to the company, it is facing demand headwinds across its network of stores, given the current macro environment, as well as a supply challenge in a smaller subgroup of stores due to the constraints on eye exam capacity. Contraction of both margins on escalating expenses is discouraging.
On a positive note, the company’s third-quarter results benefited from new store openings in America's Best and Eyeglass World brands.
Zacks Rank & Key Picks
National Vision currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are AMN Healthcare Services, Inc. (AMN - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
AMN Healthcare, carrying a Zacks Rank #2 (Buy), reported third-quarter 2022 adjusted EPS of $2.57, which beat the Zacks Consensus Estimate by 10.3%. Revenues of $1.14 billion outpaced the consensus mark by 3.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AMN Healthcare has an estimated long-term growth rate of 3.3%. AMN’s earnings surpassed estimates in all the trailing four quarters, the average being 10.9%.
Medpace Holdings, sporting a Zacks Rank #1, reported third-quarter 2022 EPS of $2.05, which beat the Zacks Consensus Estimate by 39.5%. Revenues of $383.7 million outpaced the consensus mark by 8.1%.
Medpace Holdings has an estimated growth rate of 44.9% for the full-year 2022. MEDP’s earnings surpassed estimates in all the trailing four quarters, the average being 22%.
Merit Medical, carrying a Zacks Rank #2, reported third-quarter 2022 adjusted EPS of 64 cents, which beat the Zacks Consensus Estimate by 20.8%. Revenues of $287.2 million outpaced the consensus mark by 5.2%.
Merit Medical has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average being 25.4%.