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Zumiez (ZUMZ) Jumps on Solid Sales & Comps Results for March


Zumiez Inc. ZUMZ has been riding high on a favorable comparable-store sales (comps) trend. The company continued this trend by reporting robust sales and comps numbers for March as well, marking the 13th straight month of comps growth. Consequently, shares of the company were up nearly 2% in after-hours trading on Apr 11.

This mall-based specialty retailer recorded 12.6% comps growth for the five-week period ended Apr 7, 2018, compared with 1.1% increase witnessed in the five weeks ended Apr 1, 2017. Further, total net sales for March advanced 14.7% to $82.3 million from $71.7 million in the year-ago period.

Looking at fiscal 2018, Zumiez remains confident of delivering accelerated earnings growth, backed by solid top-line and positive comps trends, margin enhancement programs, improved expense leverage and lower taxes. Moreover, the company believes that infrastructure investments, made to provide seamless customer experience as well as a unique approach to merchandising, will aid both top- and bottom-line growth in 2018 and beyond. Consequently, the company projects comps to grow in the low-single-digit range in fiscal 2018.

However, the company earlier provided a soft guidance for first-quarter fiscal 2018. While it outlined robust comps growth and sales in the quarter, earnings projections were discouraging.

The company expects net sales for the first quarter in the $198-$202 million range, while comps growth is anticipated to be 4-6%. It stated that monthly sales in the quarter will be impacted by the shift in Easter holiday. The shift is likely to bear a positive impact on sales for March and hurt sales in April.

Overall, Zumiez is gaining from robust merchandise strategies, solid store-expansion endeavors and e-commerce platform. Backed by strategic initiatives and sturdy comps performance, Zumiez’s shares have gained a whopping 26.5% in the past month, substantially outperforming the industry’s growth of 1.3%.

Looking for More? Check These

Some stocks worth considering from the Apparel and Shoes industry are The Buckle, Inc BKE, The Gap Inc. GPS and Nordstrom Inc. JWN, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Buckle has gained 26.8% in the past month. Moreover, it has delivered an average positive earnings surprise of 9.1% in the trailing four quarters.

Gap has delivered an average positive earnings surprise of 11.1% in the trailing four quarters. It has a long-term earnings growth rate of 8%.

Nordstrom has a long-term EPS growth rate of 6%. Further, the stock has returned 14.9% in the last six months.

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