ZUMZ stock is hitting a new multi-year high in Friday’s session after Zumiez Inc. (NASDAQ:ZUMZ) reported better than estimated earnings for the third quarter.
Impressive Comparable Sales
The earnings frenzy might be coming to an end, but many companies are still declaring their third-quarter results on a daily basis, and the latest to announce its third-quarter financial results was clothing retailer Zumiez Inc. The company reported strong numbers in the third quarter, and more importantly, it managed to surpass analysts’ estimates for the seventh quarter in a row.
While both the bottom line and the top line generated year-on-year growth, Zumiez also managed to grow its sales. Sales grew for the 13th straight quarter. The performance also prompted the company to raise its fourth-quarter projections.
Zumiez generated earnings of 75 cents a share, which was higher than analysts’ estimates of 60 cents a share. In the prior-year period, earnings stood at 55 cents a share. The most important takeaway was perhaps the growth in net sales to $264 million, which reflected a year-on-year growth of 6.1%.
Analysts had estimated sales of $260 million for the quarter. Since the end of the third quarter in 2018, Zumiez opened as many as 15 stores, and that reflected in the company’s impressive sales growth.
ZUMZ stock is up 14.50% at $34.99 after hitting a 4-year high of $35.25.
Zumiez’s gross profit soared to $94.6 million and recorded year-on-year growth of as much as 8.9%. The company achieved that by cutting down on various costs significantly. The chief among these were store occupancy costs, as well as distribution and shipping costs. That being said, overall expenses actually rose year-on-year by 2.6% to hit $70.3 million. Zumiez concluded the quarter with $31.9 million in cash and cash equivalents.
There was more positive news on the way as the company raised its projections for the fourth quarter. It expects sales to be in the $314 million to $320 million range, which will be comfortably higher than the $304.6 million in sales it had generated in Q4 2018.
ZUMZ stock is up over 78% year-to-date.
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