Zumiez (ZUMZ) Guides Q2 EPS 14c Below Consensus; Wedbush Cuts Price Target
Wedbush reiterates a Neutral rating on Zumiez, Inc. (NASDAQ: ZUMZ), and cuts the price target to $26.00 (from $31.00), following Q1 results and Q2 Guidance. ZUMZ reported 1Q15 EPS of $0.12, in line with consensus. ZUMZ provided 2Q EPS guidance of $0.13-$0.16, well below consensus expectations of $0.30.
Analyst Morry Brown commented, "Heading into 1Q EPS, we were concerned soft guidance could pressure shares, as our 2Q estimate of $0.27 stood $0.03 below consensus. The magnitude of the guide-down was beyond our expectations, as was the downshift to negative comps. While the company pointed to positive trends in long bottoms (which increase as a percentage of the mix in the fall), we find it difficult to model any meaningful improvement in comp trend in 3Q, given how quickly comps have decelerated. Additionally, the company cited a lack of any definitive fashion trend as a partial driver of the slowdown, and it appears unclear why this would change quickly. We believe there is too much uncertainty around near-term sales trends to step in and buy on the negative stock reaction."
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Shares of Zumiez, Inc. closed at $29.74 yesterday.