Earnings Preview: Gymboree

| About: Gymboree Corp. (GYMB)

The Gymboree Corporation (NASDAQ:GYMB) is expected to report Q2 earnings after market close Wednesday, Aug.20 with a conference call scheduled for 4:30 pm ET.


Analysts are looking for a profit of 24c on revenue of $204.3M. The consensus range is 20c to 26c for EPS, and revenue of $201.42M to $207.2M, according to First Call. After reporting its Q2 same-store sales increased 1%, Gymboree predicted Q2 EPS 23c to 25c and FY09 EPS $3.15 to $3.20 vs. First Call consensus of $3.19.

Analyst Views

Wedbush, which has a Strong Buy rating on shares, continues to believe Gymboree benefits from its leading position in the more resilient children's apparel space and continues to outperform due to their solid pricing strategies, which when coupled with brand-appropriate designs and product quality, enables the brands to differentiate themselves from the competition. The firm believes sourcing initiatives may deliver more muted merchandise margin gains in FY09, and highlights Gymboree's ability to benefit from increasing purchasing power and strategic diversification of manufacturers

However, FBR Capital Markets believes that while Gymboree's recent performance has been "nothing short of outstanding," the macro environment may negatively impact "even the best-of-breed retailers."