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Wolverine (WWW) Beats Earnings & Revenue Estimates in Q3
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Wolverine World Wide, Inc. (WWW - Free Report) delivered better-than-expected results in third-quarter 2020. Quarterly results, which outpaced management’s expectations, reflected strength in the company’s portfolio and brands. Apparently, Saucony and Chaco registered double-digit revenue growth, whereas Merrell and work brands saw robust revenue growth sequentially. Also, the company is benefiting from its digital efforts.
However, management expects coronavirus-induced challenges to persist in the near term, and consequently, fourth-quarter revenues are likely to decline nearly 25% year over year. This will include the impact of a partial shift in revenues from the company’s international business into first-quarter 2021. Nevertheless, Wolverine believes that its robust digital strategy and increased visibility to wholesale demand will help the company revert to significant growth in the first quarter of 2021.
In the past six months, shares of this Zacks Rank #3 (Hold) stock have increased 54.7% compared with the industry’s 45% rally.
Q3 Highlights
Wolverine’s third-quarter adjusted earnings of 35 cents per share outpaced the Zacks Consensus Estimate of 29 cents. However, the metric plunged 48.5% from 68 cents earned in the year-ago quarter. On a constant-currency (cc) basis, adjusted earnings were 34 cents per share.
Wolverine World Wide, Inc. Price, Consensus and EPS Surprise
Moreover, revenues of $493.1 million came above the Zacks Consensus Estimate of $458 million but fell 14.1% year over year. On a cc basis, revenues declined 14.6%. The year-over-year downside can probably be attributed to the ill impacts of the pandemic. However, the company’s owned e-commerce business excelled in the quarter, with revenues surging 56.4% year over year.
Gross profit amounted to $202 million, down nearly 17% year over year. Also, gross margin contracted 140 basis points (bps) year over year to 41%.
Further, adjusted selling, general and administrative expenses dropped 6.9% to $151.5 million. However, adjusted operating profit tumbled 35.3% to $52.3 million, with adjusted operating margin contracting 350 bps to 10.6%.
Segmental Performance
Revenues at Wolverine Michigan Group decreased 9.9% year over year to $287.3 million. At cc, the segment’s revenues fell 10.2% during the reported quarter.
Wolverine Boston Group’s revenues tumbled 19.7% to $193.8 million from the year-ago quarter. At cc, the segment’s revenues decreased 20.3% during the reported quarter.
Other Financials
The company ended the quarter with cash and cash equivalents of $342 million, long-term debt of $714.1 million and stockholders' equity of $765.5 million. Further, the adjusted net inventories in the third quarter decreased 22.9% to $322.1 million.
Notably, Wolverine has delivered nearly $135.5 million of cash flow from operations in the first nine months of 2020. Net cash generated from operating activities was $96.5 million during the third quarter of 2020.
Rent-A-Center has delivered an earnings surprise of 12.9% in the last four quarters, on average. The company currently has a Zacks Rank of 2 (Buy).
Deckers (DECK - Free Report) , also a Zacks Rank #2 stock has an expected long-term earnings-growth rate of 18.6%.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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Wolverine (WWW) Beats Earnings & Revenue Estimates in Q3
Wolverine World Wide, Inc. (WWW - Free Report) delivered better-than-expected results in third-quarter 2020. Quarterly results, which outpaced management’s expectations, reflected strength in the company’s portfolio and brands. Apparently, Saucony and Chaco registered double-digit revenue growth, whereas Merrell and work brands saw robust revenue growth sequentially. Also, the company is benefiting from its digital efforts.
However, management expects coronavirus-induced challenges to persist in the near term, and consequently, fourth-quarter revenues are likely to decline nearly 25% year over year. This will include the impact of a partial shift in revenues from the company’s international business into first-quarter 2021. Nevertheless, Wolverine believes that its robust digital strategy and increased visibility to wholesale demand will help the company revert to significant growth in the first quarter of 2021.
In the past six months, shares of this Zacks Rank #3 (Hold) stock have increased 54.7% compared with the industry’s 45% rally.
Q3 Highlights
Wolverine’s third-quarter adjusted earnings of 35 cents per share outpaced the Zacks Consensus Estimate of 29 cents. However, the metric plunged 48.5% from 68 cents earned in the year-ago quarter. On a constant-currency (cc) basis, adjusted earnings were 34 cents per share.
Wolverine World Wide, Inc. Price, Consensus and EPS Surprise
Wolverine World Wide, Inc. price-consensus-eps-surprise-chart | Wolverine World Wide, Inc. Quote
Moreover, revenues of $493.1 million came above the Zacks Consensus Estimate of $458 million but fell 14.1% year over year. On a cc basis, revenues declined 14.6%. The year-over-year downside can probably be attributed to the ill impacts of the pandemic. However, the company’s owned e-commerce business excelled in the quarter, with revenues surging 56.4% year over year.
Gross profit amounted to $202 million, down nearly 17% year over year. Also, gross margin contracted 140 basis points (bps) year over year to 41%.
Further, adjusted selling, general and administrative expenses dropped 6.9% to $151.5 million. However, adjusted operating profit tumbled 35.3% to $52.3 million, with adjusted operating margin contracting 350 bps to 10.6%.
Segmental Performance
Revenues at Wolverine Michigan Group decreased 9.9% year over year to $287.3 million. At cc, the segment’s revenues fell 10.2% during the reported quarter.
Wolverine Boston Group’s revenues tumbled 19.7% to $193.8 million from the year-ago quarter. At cc, the segment’s revenues decreased 20.3% during the reported quarter.
Other Financials
The company ended the quarter with cash and cash equivalents of $342 million, long-term debt of $714.1 million and stockholders' equity of $765.5 million. Further, the adjusted net inventories in the third quarter decreased 22.9% to $322.1 million.
Notably, Wolverine has delivered nearly $135.5 million of cash flow from operations in the first nine months of 2020. Net cash generated from operating activities was $96.5 million during the third quarter of 2020.
Don’t Miss These Solid Bets
Crocs (CROX - Free Report) has delivered an earnings surprise of 191.7% in the last four quarters, on average. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Rent-A-Center has delivered an earnings surprise of 12.9% in the last four quarters, on average. The company currently has a Zacks Rank of 2 (Buy).
Deckers (DECK - Free Report) , also a Zacks Rank #2 stock has an expected long-term earnings-growth rate of 18.6%.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>