Battered by increased input costs along with higher marketing
Jos. A. Bank Clothiers Inc.
) anticipates that its net income for fiscal 2012 will decline
20% from the previous fiscal level of $97.5 million. However,
this Zacks Rank #4 (Sell) company is still expecting to post
positive income in the fourth quarter and fiscal 2012.
Per the company, total sales for the fiscal are higher than
the fiscal 2011 level and have crossed the $1.0 billion sales
landmark. This is the first time in the company's history that it
has touched this milestone.
Currently, the Zacks Consensus Estimate for fiscal 2012
revenue is pegged at $989.0 million, while earnings per share
stand at $3.67.
Moreover, following the footsteps of its competitors,
Citi Trends, Inc.
), Jos has opened 46 new stores during fiscal 2012 and intends to
add 45 to 50 more new stores in fiscal 2013. We believe that the
company's strong balance sheet and ability to generate solid cash
flow facilitate it in expanding the store network.
Further, the company's fourth-quarter sales have been
negatively impacted by Superstorm Sandy along with a diversion
generated from Presidential election and uncertainty over fiscal
cliff. Moreover, the company's one of the strongest holidays
selling season was hit by unfavorable weather conditions despite
the strong marketing and promotional strategies. However, the
company's direct marketing business is doing well and has
registered year-over-year double-digit sales growth during the
For the quarter, the current Zacks Consensus Estimate for
revenue and earnings per share are pegged at $232.0 million and
Jos has a unique business model of offering products initially
at higher mark-ups and then provide discount on them. The company
is famous for its 'buy one get seven' and '70% off' deals, which
have worked for years.
This is the first time that the company's aggressive marketing
and promotional steps didn't pay off well. Therefore, we believe
that the company needs to revive its marketing strategies
according to the current market scenario and competition.
CITI TRENDS INC (CTRN): Free Stock Analysis
DSW INC CL-A (DSW): Free Stock Analysis
EXPRESS INC (EXPR): Free Stock Analysis
JOS A BANK CLTH (JOSB): Free Stock Analysis
To read this article on Zacks.com click here.