Zumiez Inc. (ZUMZ), an action sports retailer in the United States, reported comparable store sales for the four-week period ended May 28, 2011. Total net sales for the period increased by a sharp 14.9% to $30.3 million from $26.3 million reported in the four-week period ended May 29, 2010.
For the reported period, comparable store sales jumped 7.8% compared with a rise of 7.1% in the prior-year period. The April results marked the 18th consecutive month of comparable store sales growth.
Hot Topic Inc. (HOTT), which competes with Zumiez, reported a growth of 0.4% in May comparable store sales, with total sales decreasing 1.5%.
Prior to this, Zumiez reported first-quarter 2011 earnings of 6 cents a share, beating the Zacks Consensus Estimate of 2 cents a share. The company also outpaced a loss of 3 cents a share posted in the first quarter of fiscal 2010. Net income from operations was $1.9 million compared with a loss of $0.7 million in the prior-year quarter.
Net sales in the reported quarter increased 18.8% year over year to $105.9 million from $89.1 million a year ago. Comparable store sales rose 12.6% in the quarter compared with an increase of 9.1% in first-quarter 2010. Total revenue also beats the Zacks Consensus Estimate of $101 million.
For the second quarter of 2011, management expects comparable store sales to increase in the mid-single-digit range and net income to be in the range of 2 to 4 cents per share.
Zumiez is a mall-based specialty retailer of action-sports related apparel, footwear, equipment, and accessories. The company targets young men and women in the age group of 12 to 24 years, who seeks popular brands that represent a lifestyle centered on extreme sports activities.
Zumiez's stores span across 2,900 square feet on an average, and feature couches and video game stations to entice customers to shop for extended periods. These stores are strategically located near busy areas of the mall, such as food courts, movie theatres, music/game stores and other popular teenage hang-out destinations.
Zumiez, which competes with Pacific Sunwear of California Inc. (PSUN) and Wet Seal Inc. (WTSLA), currently, holds a Zacks #2 Rank, implying a short-term 'Buy' rating on the stock. This corresponds with our long-term 'Neutral' recommendation on the stock.
HOT TOPIC INC (HOTT): Free Stock Analysis Report
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