Zumiez Inc. ZUMZ continued with its dismal performance with July marking the fourth consecutive month of negative comparable store sales (comps).
The company’s comps for the four weeks ended Aug 1, 2015, fell 7.6% against a 3.5% rise recorded in the prior-year period. Net sales of this Washington-based sports-related teen apparel retailer dipped 2.3% to $61.4 million.
The company also revealed that its comps for second-quarter 2015 declined 4.5% but was consistent with its guidance of a 3–5% decline. The fall in comps for the quarter is due to heightened pressure both from the sales and profit margin standpoint. While sales were impacted by the calendar shift in Labor Day and related sales tax holidays, product margins felt the pressure of increased promotions to do away with seasonal inventory.
As a result, the company now projects earnings per share for the second quarter slightly below its previous forecast of 12 cents.
Taking into account the calendar shift in Labor day, Zumiez has scheduled to release its financial results for the second quarter of 2015 along with its comps results for August on Sep 10, 2015.
Looking back, this Zacks Rank #3 (Hold) company reported negative comps of 4%, 2.2% and 3.3% for April, May and June, respectively.
However, prior to April, Zumiez had posted positive comps for 12 months in a row. Comps for the months of January, February and March this year improved 12.3%, 6.9% and 5.5%, respectively. This trend was backed by Zumiez’s constant focus on boosting productivity at existing stores, developing a leading omni-channel platform and enhancing its presence, both domestically and overseas.
Stocks to Consider
Some better-ranked stocks in the apparel-shoe industry are Aeropostale Inc. ARO, Foot Locker Inc. FL and DSW Inc. DSW, each carrying a Zacks Rank #2 (Buy).
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