MARKET CURRENTS
real-time news and commentary for investors
MARKET CURRENTS
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Today - Friday, May 24, 2013
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4:17 PM DA Davidson chimes in on HEICO (HEI +1.2%) today after the company posted a solid FQ2, raising its price target from $44 to $48 and reiterating its Buy rating. The firm says the raised guidance by the company indicates strong organic growth, while the benefits from its Reinhold acquisition also appear to be gaining traction as well. Credit Suisse also upped its price target on the shares as well on the strong quarter from $43 to $50. Comment!
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2:51 PM Callaway Golf (ELY +6.8%) enjoys a strong session after earnings and revenue top estimates. More from the report: Strength in existing product lines (X Hot and Versa putters) fuels a 12% Y/Y increase in net sales (this excludes brands that were divested in 2012), and improvements in gross margins as well as lower operating expenses help the company post a 27% rise in GAAP EPS. Outlook: FY13 revenue guidance lowered to $830M from $850M, FY13 EPS guidance is reiterated at -$0.04 after accounting for a preferred dividend (consensus is $832M and -$0.05). (PR, CC transcript) Comment!
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12:38 PM Heard during Foot Locker's (FL -6.1%) earnings call: 1) Execs say products are "right" at Foot Locker stores, but due to weather patterns more sales will shift to Q2 from Q1. 2) In Q1, traffic was down, but ASPs were higher. 3) The planned acquisition of Runners Point Group appears to be a bet on Germany - not the continent as a whole. 4) The retailer says comparable store sales are flat this month. That's not great news for Nike (NKE -1.4%), Under Armour (UA -1.3%), or Finish Line (FINL -2.2%) - unless the catch-up that Foot Locker points to materializes. (webcast) Comment!
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11:11 AM Hibbett Sports (HIBB -4.1%) sinks after Q1 earnings and revenue miss estimates. From the report: Sales and comps rise 3% and 0.8% Y/Y respectively (Q1 2012 comps were +12%). Product margin was up during the period, but an 18 basis point rise in warehouse expenses hurt HIBB's gross margin, which fell slightly (10 basis points Y/Y). FY14 EPS outlook is reiterated at $2.85-3.05 versus consensus of $3.03. (PR) Comment!
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11:01 AM Taro Pharmaceutical (TARO -7%) slides after earlier reporting Q1 earnings of $1.10 per share on net sales of $165.1M, an increase of 13.8%, from a year ago. Gross margin grew to 72.4% from 68.3%, offsetting an increase in Research and development expenses by 23.9% to $12.2M. Settlements and loss contingencies totalled $33.3M, dragging down operating income to $63.1M, or 38.2% of net sales, compared to $66.2 million, or 45.6% the year prior. 3 Comments
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10:27 AM Shoe Carnival (SCVL +10%) hits a 52-week high after Q1 results top estimates. From the report: Q1 was challenging thanks to colder weather, but trends improved in April helping comps growth which, although still negative (-0.8%), was better than the company anticipated. Revenues rise 4.3% Y/Y, profit margin falls 130 basis points, SG&A falls $2.8M. Guidance: Q2 revenue of $217-220 and EPS of $0.26-0.30 against consensus of $218.88 and $0.28/share. (PR) Comment!
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8:49 AM More on Tsakos Energy's (TNP) Q1 results: Profit improvement was primarily driven by a 6% increase in the average time charter rate per vessel, and a drop in the fleet's overall expenses of 7.4% Y/Y on a per-ship basis while the fleet's total voyage expenses fell 24.1% Y/Y. Utilization rate was 98%. Shares +22.8% premarket. 1 Comment
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7:23 AM More on Abercrombie & Fitch (ANF): The company was selling, but not as many people were buying in Q1. Comparable store sales fell 15% including direct-to-consumer sales with Hollister off 18% and the Abercrombie & Fitch brand falling 13%. Sales weakened at the end of the quarter even with improving weather patterns. The retailer says "external pressures" led to significant inventory issues during the period. Full-year EPS guidance is taken down to $3.15-$3.25 and Q2 is adjusted to $0.28-$0.33. ANF -7.5% premarket. (PR) 1 Comment
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Thursday, May 23, 2013
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9:04 PM More on Ross Stores' (ROST) Q1: Revenue and comps rise 8% and 3% Y/Y respectively (comps growth was 9% in Q1 2012). Operating margin rises 50 basis points to a record 14.9% thanks to "higher merchandise gross margins and [the] favorable timing of expenses." CEO Michael Balmuth says the company is on track to repurchase ~$550M in shares in FY13. Outlook: Q2 EPS of $0.89-0.93 (consensus is $0.91/share ) and FY13 EPS of $3.70-3.81 (consensus is $3.88/share). Shares +0.8% AH. (PR) Comment!
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8:50 PM More on Williams-Sonoma's (WSM) Q1: Revenues, operating margin, and EPS rise 8.6%, 120 basis points, and 33% Y/Y respectively. The quarter was "the best Q1 in the company's history," CEO Laura Alber says. Comps (which is "comparable brand revenue" here) rose 7.2% versus 5.4% growth in Q1 2012. Negative Q1 2012 comps growth in the namesake brand, Pottery Barn Kids, and PBteen is reversed, as the brands see growth of 1.9%, 6.9%, and 16.1% respectively during the quarter. WSM raises FY13 guidance to $2.67-2.77/share on revenue of $4.22-4.3B against consensus of $2.77/share and sales of $4.25B. Shares flat AH. (PR) Comment!
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8:37 PM More on Zumiez' (ZUMZ) Q1: Revenues rise 14.3% Y/Y, even as comps drop 0.7% (comps growth was 12.9% in Q1 2012). CEO Rick Brooks reminds investors that the operating environment in Q1 was "more challenging" than it was in the same period a year ago and notes that "business improved throughout the quarter driven by strong full price selling during" March and April. For Q2 ZUMZ sees EPS of $0.12-0.14 (including a ~$0.04/share hit from the Blue Tomato acquisition) on revenue of $155-158M — consensus is for $0.17/share on sales of $156.79M. Shares -3.09% AH. (PR) Comment!
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8:20 PM More on Aeropostale's (ARO) Q1: Revenues and comps fall 9% and 14% Y/Y respectively. The company cites a "weak macroeconomic environment [and] unseasonably cool weather" — so, the usual suspects — as negative factors. E-commerce revenues (included in the comps calculation) rise 13%. CEO Thomas Johnson says visibility is "limited" going forward but expresses confidence in the company's strategic initiatives to transform the brand and "develop growth drivers." For Q2, ARO sees a loss of $0.15-0.20/share versus consensus of a $0.06 per share loss. Shares -4.49% AH. (PR) Comment!
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