) has hit a 52-week high twice this month, having gained momentum
after releasing preliminary sales and gross margin numbers for its
fiscal third quarter. Furthermore, shares of this Zacks #1 Rank
(Strong Buy) specialty retailer of durable consumer products have
more than doubled in price since the beginning of this year.
Preliminary Q3 Sales and Gross Margin
On November 8, Conn's reported preliminary sales, same store sales
and gross margin results for its fiscal third quarter. Net sales
were up 8% year over year to $167.3 million, compared to the Zacks
Consensus Estimate of $199 million.
Same store sales increased 12.6% during the quarter, marking the
fifth consecutive double-digit same store sales growth for the
company. The upside in retail sales was driven by higher average
selling prices, increased furniture and mattress offerings and
growth in home office sales. This was offset by declines in unit
volume due to previously closed stores.
Retail gross margin was 35% in the quarter, up 970 basis points
year over year. A favorable sales mix across all product
categories, combined with the expanded furniture and mattress
business, largely drove retail gross margin in the quarter.
Conn's is scheduled to release its complete fiscal 2013 third
quarter results on December 3, 2012.
Preliminary Results Drive Estimates
Following the preliminary results, earnings estimates have been
trending higher in the past 30 days. The Zacks Consensus Estimate
for fiscal 2013 rose 2.7% to $1.52 per share, as 4 of 7 estimates
were revised higher. This represents year-over-year growth of
The Zacks Consensus Estimate for fiscal 2014 advanced 3.3% to $1.90
per share over the same time frame, as 4 of 7 estimates again
advanced, reflecting a year-over-year increase of 24.8%.
Shares of Conn's have recorded a year-to-date return of 141.5%,
indicating that the company continues to gain from its earnings and
sales momentum, as well as its expanding credit portfolio.
Moreover, shares have continually traded above the 200-day moving
average since the beginning of calendar year 2012. The stock is
also trading above its 50-day moving average since July 26, 2012.
Additionally, the company has outperformed the S&P 500 Index
since February 6, 2012.
Founded in 1890 and headquartered in Beaumont, Texas, Conn's is a
retailer of durable consumer products in the United States. The
company deals in home appliances, furniture and mattress, consumer
electronics and home office products. Additionally, the company
offers a variety of products on a seasonal basis, including lawn
and garden equipment. The company also provides flexible in-house
credit options for its customers, in addition to third-party
financing programs and third-party rent-to-own payment plans.
Conn's has a market cap of 917 million.
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