U.S. Specialty retailer in action sports related apparel,
footwear, equipment and accessories,
), is scheduled to release its second-quarter 2012 results on
Thursday, August 30, 2012.
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ZUMIEZ INC (ZUMZ): Free Stock Analysis Report
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The current Zacks Consensus earnings per share (EPS) estimate for
the second quarter stands at 13 cents, reflecting a year-over-year
growth of 57.0%. Estimate revision trend in the past couple of
months remained stable.
Further, Zumiez outperformed the Zacks Consensus Estimate in the
trailing four quarters, exhibiting continued strength and
consistent with its history of delivering positive earnings
surprises. Zumiez's first quarter witnessed a positive surprise of
36.4%. The company's average surprise for the trailing four
quarters comes to nearly 27.0%.
Summarizing First-Quarter 2012
On May 17, Zumiez reported better-than-expected results for
first-quarter 2012 on account of improved margins as well as strong
merchandise, store expansion and e-commerce strategies. Quarterly
earnings of 15 cents per share beat the Zacks Consensus Estimate of
11 cents and surged 150.0% from the prior-period level of 11 cents.
Net sales in the reported quarter climbed 22.7% to $129.9 million
from $105.9 million a year ago. Total revenue was almost in line
with the Zacks Consensus Estimate of $129 million. First-quarter
2012 comparable store sales at Zumiez were up 12.9% compared with
an increase of 12.6% reported in first-quarter 2011.
Following solid first-quarter results, Zumiez initiated its sales
and earnings guidance for the second quarter of fiscal 2012.
Management anticipates second-quarter revenue in the range of $128
- $130 million, on the back of a mid-single-digit growth in
comparable store sales. Based on sales projections for the quarter,
the company expects earnings per share to come in the band of 4
cents - 6 cents.
Estimate revision trend in the second-quarter have been largely
stable, with estimates remaining intact over the last 7, 30 and 60
days. The last estimate revision was seen 90 days back, reflecting
the effect of solid first quarter results.
In the last 30 days, second quarter estimates remained unchanged,
with only one out of 16 estimates moving down. For fiscal 2012, 2
out of 16 estimates were revised upwards, while one estimate
slipped in the last 30 days. In effect, estimate for fiscal 2012
was steady at $1.60. Estimates for fiscal 2013 witnessed two upward
revisions with no movement in the opposite direction, in the same
time period. However, estimates for fiscal 2unchanged at $1.84.
There was no change in estimates in the last 30 days. However, the
estimates were revised upwards 90 days ago. Second quarter
estimates reflected an upside of 3 cents per share 90 days back.
Over the same time frame, estimates for fiscal 2012 and 2013 moved
up by 7 cents and 12 cents per share, respectively.
Zumiez is currently in the early phase of its store expansion
program and plans to enlarge its network by opening 50 new stores
during fiscal 2012, including 10 new stores in Canada.
Additionally, in the recent years, Zumiez has launched stores
averaging 3,000 square feet, which enables it to offer extended
merchandise without compromising on the store ambience. These
initiatives provide the company with a strong platform to
effectively capitalize on the emerging opportunities.
Further, the Everett, Washington-based sporting goods retailer
targets young men and women in the age group of 12 to 24 years, who
seek popular brands that represent a lifestyle centered around
extreme sports activities. This provides the company a distinct
market niche, which in combination with its store expansion
strategy should help deliver solid performance in the upcoming
However, intense competition from other specialty retailers like
Hot Topic Inc.
Pacific Sunwear of California Inc.
), seasonal nature of the business and risks associated with
sourcing merchandise from foreign countries may weigh upon the
Currently, Zumiez holds a Zacks #3 Rank, implying a short-term
'Hold' rating on the stock. However, we retain our long-term
'Outperform' recommendation on the stock.