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Zumiez Retains Decent Comps Trend in December, Raises View

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Zumiez Inc. (ZUMZ - Free Report) continues with its decent comparable sales (comps) performance. This specialty retailer of apparel, footwear and accessories reported a 4.9% increase in comps for the five-week period ended Jan 5, 2019 compared with 7.9% growth witnessed in the five weeks ended Dec 30, 2017. We note that comps have improved 2.3%, 1.6%, and 1.2% in the month of November, October and September, respectively.

Notably, December marked the 12th straight month of positive comps this year. Certainly, the company’s differentiated product offerings, seamless multi-channel shopping experience and superior customer service positions it well. Total net sales for December advanced 2.9% to $164.6 million from $160 million in the year-ago period. Prior to this, net sales grew 9.4% and 0.6% in November and October, respectively, while it declined 8% in September.  

Moving on, the company kick started the fourth quarter on a solid note, driven by robust demand during the Black Friday weekend and Cyber Monday. Encouraged by higher-than-anticipated quarter-to-date sales, management raised its fourth-quarter fiscal 2018 view.

The company now anticipates comps growth of about 3% and adjusted earnings per share of $1.08-$1.10. This indicates an increase from the prior guidance of 0-2% comps growth and adjusted earnings of $1.02-$1.08. The Zacks Consensus Estimate for the reported quarter is pegged at $1.05, which is likely to witness upward revision in the coming days.

Meanwhile, this Zacks Rank #3 (Hold) stock has gained 13.7% in the past month, against the industry’s decline of 3.5%.

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