On Jun 18, 2014, Zacks Investment Research upgraded
Christopher & Banks Corporation
) to a Zacks Rank #1 (Strong Buy). Shares of this specialty
retailer of women's fashion attire and accessories exhibited an
impressive year-over-year return of 32.2%.
Why the Upgrade?
Christopher & Banks has been witnessing rising earnings
estimates owing to impressive first-quarter fiscal 2014 results, on
the back of gross margin expansion that stemmed from superior
merchandise offering and enhanced inventory management strategies.
The company declared strong bottom-line results on Jun 10, 2014,
wherein earnings of 7 cents a share fared better than the Zacks
Consensus Estimate of 5 cents per share. Earnings also surpassed
the comparable year-ago quarter's earnings of 2 cents per share.
Christopher & Banks has outperformed the Zacks Consensus
Estimate in 4 straight quarters by an average of 110.9%.
However, net sales were a little disappointing during the quarter
as it reflected a decline of 4.7% year over year to $103.4 million.
Sales also came below the Zacks Consensus Estimate of $105 million.
The decline in top line was due to fewer stores in operation than
the last year as well as an inclement weather during the first half
of the quarter. Moreover, comparable store sales (comps) declined
2% in the quarter as against a 23.4% increase last year.
Nevertheless, the downside in top line and comps did not affect the
gross margin, which expanded 750 basis points (bps) to 36.7%.
Further, the company projected comps to increase in the low to
mid-single digit range for the second quarter, while gross margin
is expected to expand about 100-150 bps during the quarter.
Driven by an impressive first quarter, the Zacks Consensus Estimate
for fiscal 2014 improved 9.1% to 36 cents per share in the last 30
Other Stocks to Consider
Other well performing stocks in the apparel-shoe retail space
Citi Trends Inc.
) sporting a Zacks Rank #1 (Strong Buy) along with
Foot Locker Inc.
The Men's Wearhouse Inc.
), both carrying a Zacks Rank #2 (Buy).
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