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Zumiez Growth on Track; Stock Up on Revival of Comps Trend
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Shares of Zumiez Inc. (ZUMZ - Free Report) gained 9.5% in the after-hours trading session on Nov 2, as this specialty retailer of apparel, footwear and accessories seems to be back on the growth track after posting negative comparable store sales (comps) and dismal sales results for 17 straight quarters. Further, the company raised its third-quarter fiscal 2016 earnings outlook ,backed by greater-than-expected sales in the quarter-to-date period.
Zumiez’s comps for the four weeks ended Oct 29, 2016, rose 10.2% as against an 8.1% decline witnessed for the four-week period ended Oct 31, 2015. Additionally, net sales for Oct 2016 climbed 14.4% to $55.9 million from $48.9 million in the year-ago period.
Comps for September brought a turnaround in the company’s 17-month long dismal sales trend, which can primarily be attributed to slow mall traffic and the absence of defined fashion trends. Last month, the company reported a 6.3% increase in comps compared with a 1.8% dip witnessed in the five-week period ended Oct 3, 2015. Further, net sales for Sep 2016 climbed 11.5% to $75 million from $67.3 million in the year-ago period.
The company continues to show resilience as evident from a strong quarter-to-date sales performance. This once again persuaded management to raise its earnings guidance for the fiscal third quarter, after a hike announced last month. Earnings per share are now anticipated in the range of 35–36 cents compared with 29–30 cents per share guided earlier.
Prior to this, the company had raised its third-quarter fiscal 2016 sales, earnings and comps outlook last month, mainly driven by the strong September sales performance and favorable trends year to date. The retailer upped its net sales guidance to a range of $216–$217 million from its previous forecast of $209–$213 million. The company predicted comps growth of 2% for the fiscal third quarter, against the previous comps growth range of negative 2% to flat. Earnings per share guidance was raised to 29–30 cents from 21–26 cents guided previously.
We believe Zumiez remains on track with its expansion strategies, which are aimed at placing it on the growth track and generating near-term profit. Further, the company’s investments in global expansion, enhancing omni-channel capacities and customer-centric approach bode well.
Currently, Zumiez carries a Zacks Rank #3 (Hold). Investors can count on better-ranked stocks like DSW Inc. , sporting a Zacks Rank #1 (Strong Buy), as well as American Eagle Outfitters Inc. (AEO - Free Report) and Boot Barn Holdings Inc. (BOOT - Free Report) , each with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
DSW Inc. has an average earnings beat of 24% in the last four quarters, and estimates for the current fiscal year moved up in the last 60 days. Moreover, the company has a long-term EPS growth rate of 8.3%.
American Eagle has a positive record of earnings surprises in the trailing four quarters, with an average beat of 9.3%. The stock has seen positive estimate revisions for the current fiscal year, over the last 90 days and has a long-term EPS growth rate of 11.8%.
Boot Barn Holdings has posted in-line results in the last two quarters. Estimates for the current fiscal year have moved up in the last 7 days and the company has a long-term EPS growth rate of 14.5%.
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Zumiez Growth on Track; Stock Up on Revival of Comps Trend
Shares of Zumiez Inc. (ZUMZ - Free Report) gained 9.5% in the after-hours trading session on Nov 2, as this specialty retailer of apparel, footwear and accessories seems to be back on the growth track after posting negative comparable store sales (comps) and dismal sales results for 17 straight quarters. Further, the company raised its third-quarter fiscal 2016 earnings outlook ,backed by greater-than-expected sales in the quarter-to-date period.
Zumiez’s comps for the four weeks ended Oct 29, 2016, rose 10.2% as against an 8.1% decline witnessed for the four-week period ended Oct 31, 2015. Additionally, net sales for Oct 2016 climbed 14.4% to $55.9 million from $48.9 million in the year-ago period.
Comps for September brought a turnaround in the company’s 17-month long dismal sales trend, which can primarily be attributed to slow mall traffic and the absence of defined fashion trends. Last month, the company reported a 6.3% increase in comps compared with a 1.8% dip witnessed in the five-week period ended Oct 3, 2015. Further, net sales for Sep 2016 climbed 11.5% to $75 million from $67.3 million in the year-ago period.
The company continues to show resilience as evident from a strong quarter-to-date sales performance. This once again persuaded management to raise its earnings guidance for the fiscal third quarter, after a hike announced last month. Earnings per share are now anticipated in the range of 35–36 cents compared with 29–30 cents per share guided earlier.
Prior to this, the company had raised its third-quarter fiscal 2016 sales, earnings and comps outlook last month, mainly driven by the strong September sales performance and favorable trends year to date. The retailer upped its net sales guidance to a range of $216–$217 million from its previous forecast of $209–$213 million. The company predicted comps growth of 2% for the fiscal third quarter, against the previous comps growth range of negative 2% to flat. Earnings per share guidance was raised to 29–30 cents from 21–26 cents guided previously.
We believe Zumiez remains on track with its expansion strategies, which are aimed at placing it on the growth track and generating near-term profit. Further, the company’s investments in global expansion, enhancing omni-channel capacities and customer-centric approach bode well.
ZUMIEZ INC Price
ZUMIEZ INC Price | ZUMIEZ INC Quote
Zacks Rank
Currently, Zumiez carries a Zacks Rank #3 (Hold). Investors can count on better-ranked stocks like DSW Inc. , sporting a Zacks Rank #1 (Strong Buy), as well as American Eagle Outfitters Inc. (AEO - Free Report) and Boot Barn Holdings Inc. (BOOT - Free Report) , each with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
DSW Inc. has an average earnings beat of 24% in the last four quarters, and estimates for the current fiscal year moved up in the last 60 days. Moreover, the company has a long-term EPS growth rate of 8.3%.
American Eagle has a positive record of earnings surprises in the trailing four quarters, with an average beat of 9.3%. The stock has seen positive estimate revisions for the current fiscal year, over the last 90 days and has a long-term EPS growth rate of 11.8%.
Boot Barn Holdings has posted in-line results in the last two quarters. Estimates for the current fiscal year have moved up in the last 7 days and the company has a long-term EPS growth rate of 14.5%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>