Zumiez Continues its Positive Trend; January Comps Up 9.4%

Mall-based specialty retailer, Zumiez Inc.ZUMZ seems to be on the positive track with respect to its comparable sales (comps) and sales data. The company recorded a 9.4% rise in comps for the four-week period ended Jan 28, 2017 as against a 4.6% decline witnessed in the four weeks ended Jan 30, 2016. This marks the company's fifth straight month of comps growth.

Further, net sales for the same period (Jan 2017) grew 14.3% to $49.4 million from $43.2 million in the year-ago period. The better-than-expected net sales led management to expect its fourth-quarter earnings per share to be at or marginally exceed the upper-end of it previous projection of 60-66 cents. The Zacks Consensus Estimate for the current quarter is pegged at 64 cents.

The stock gained nearly 2.1% during the after-market trading hours yesterday. We noted that shares have outperformed the Zacks categorized Retail - Apparel/Shoe industry in the past six months. This Zacks Rank #2 (Buy) stock witnessed a 12.1% return, compared to industry's decline of 7.5% in the said time period.

The growth is attributed to the renewed comps trend since Sep 2016. The turnaround came after the company's 17-month long trend of posting negative comps and dismal sales results.

While the enhanced top line reflects the company's brand strength and gives positive signals, the overall retail environment remains troubled owing to sluggish mall traffic, volatile consumer spending and macroeconomic volatility.

Nevertheless, we note that the company's strategic initiatives, focus on omni-channel growth, authentic lifestyle positioning and commitment to customer service position it to gain market share in the long term.

Apart from Zumiez, Costco Wholesale Corporation COST came up with January comps results. Comps for the four-week period ended Jan 29, 2017 increased 7%.

Other Stocks You May Consider

Other favorably-placed stocks in the same industry include The Children's Place, Inc. PLCE and Tilly's, Inc. TLYS both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

The Children's Place, with a long-term earnings growth rate of 10.3% has surged 49.2% in the past one year.

Tilly's, with a long-term earnings growth rate of 13% has skyrocketed 133.9% in the past six months.

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Zumiez Inc. (ZUMZ): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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