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Bull of the Day: J.Jill (JILL)

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J.Jill, Inc. (JILL - Free Report) is benefiting from the economic reopening as women are returning to "experiences" in 2022. This Zacks Rank #1 (Strong Buy) is expected to grow earnings by double digits this year.

J.Jill is a national women's apparel retailer. It has 249 stores nationwide and sells online through its ecommerce platform.

It's a small cap retailer with a market cap of just $192.3 million.

A Huge Beat in the First Quarter of Fiscal 2022

On June 8, J.Jill reported its first quarter of fiscal 2022 results and blew by the Zacks Consensus by $0.65. Earnings were $1.02 versus the consensus of just $0.37.

It was the third big earnings beat in a row.

Zacks Investment Research
Image Source: Zacks Investment Research

Sales were up 21.7% to $157.1 million from $129.1 million a year ago.

Comparable sales jumped 23.7% with direct-to-consumer net sales down 1.8% versus a year ago driven by lower levels of markdown sales. Direct-to-consumer, which is online, represented 46.4% of sales.

Gross margin rose to 69.7% from 68% last year due to strong full price selling and reduced promotions which more than offset the 250 basis points of freight expense due to supply chain disruptions.

Women are returning to their pre-pandemic lives which means attending events and experiences like weddings and parties. Women's apparel has had a strong spring.

Full Year Earnings Estimates Raised

After the strong first quarter, it's not surprising that analysts have raised full year earnings estimates.

The Fiscal 2022 Zacks Consensus Estimate rose to $2.67 from $2.24 since the earnings report. That's earnings growth of 25.4% as J.Jill made just $2.13 last year.

Shares Rally on Strong Q1 Results

The shares have been on a roller coaster this year but they rallied off the big first quarter beat.

Nevertheless, they're still down 7.9% year-to-date but that is outperforming the S&P 500 which is down 20.3%.

Zacks Investment Research
Image Source: Zacks Investment Research

Shares are cheap, with a forward P/E of just 7.1.

But shares may be in for a wild ride as retail is an uncertain industry if the economy is slowing or going into a recession. J.Jill does not pay a dividend so there is no reward for being patient.

Nevertheless, given the strong rebound in women's apparel, investors interested in retail stocks might want to keep J.Jill on their short list.


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