Earnings Preview: The Gymboree Corporation

| About: Gymboree Corp. (GYMB)

The Gymboree Corporation (NASDAQ:GYMB) is expected to report Q3 earnings after market close Wednesday, November 19, with a conference call scheduled for 4:30 pm ET.


Analysts are looking for EPS of $1.03 on revenue of $269.6M. The consensus range is $1.02 to $1.04 for EPS, and revenue of $264.3M to $283.6M, according to First Call. The company gave Q3 and FY08 guidance when it reported it Q2 earnings. Gymboree expects Q3 EPS of $1.02 to $1.04, and FY08 EPS of $3.15 to $3.20 vs. consensus of $3.17. The company stated on November 6 that its Q3 SSS were down 2%. Gymboree also reported net sales from retail operations of $261.3M, an increase of 6% compared to net sales from retail operations of $247.6M for the Q3 of the prior year.

Analyst Views

At current levels, Friedman Billings believes substantial share appreciation will be more difficult, but that 3Q08 guidance is attainable. The firm increased FY08 and reduced FY09 EPS estimates; target price decreased to $36 from $43 and Market Perform rating reiterated. Wedbush downgraded Gymboree to Buy from Strong Buy in early November. The firm downgraded the company's shares on expectations for continued softening macro trends and lowered its target to $30 from $47. However on November 10, Gymboree was upgraded to Buy from Neutral at Merrill Lynch.