Clothing and footwear retailer Zumiez (NASDAQ:ZUMZ) will be reporting earnings tomorrow after market hours. Here’s what to look for.
Zumiez beat analysts’ revenue expectations by 4.1% last quarter, reporting revenues of $210.2 million, up 8.1% year on year. It was a very strong quarter for the company, with a solid beat of analysts’ EPS and EBITDA estimates.
Is Zumiez a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Zumiez’s revenue to grow 2.6% year on year to $222 million, a reversal from the 8.9% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.03 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Zumiez has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 2.8% on average.
Looking at Zumiez’s peers in the apparel retailer segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Urban Outfitters delivered year-on-year revenue growth of 6.3%, beating analysts’ expectations by 1.8%, and Gap reported revenues up 1.6%, topping estimates by 0.6%. Urban Outfitters traded up 18.2% following the results while Gap was also up 12.7%.
Read our full analysis of Urban Outfitters’s results here and Gap’s results here.
There has been positive sentiment among investors in the apparel retailer segment, with share prices up 7.5% on average over the last month. Zumiez is up 14.1% during the same time and is heading into earnings with an average analyst price target of $25.50 (compared to the current share price of $23.67).
When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.
