Personalized clothing company Stitch Fix (NASDAQ: SFIX) will be reporting earnings this Wednesday after the bell. Here’s what to look for.
Stitch Fix beat analysts’ revenue expectations last quarter, reporting revenues of $341.3 million, up 9.4% year on year. It was a satisfactory quarter for the company, with a beat of analysts’ EPS estimates but a significant miss of analysts’ EBITDA estimates. It reported 2.29 million active clients, down 3.5% year on year.
Is Stitch Fix a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Stitch Fix’s revenue to grow 2.9% year on year, improving from its flat revenue in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Stitch Fix has a history of exceeding Wall Street’s expectations.
Looking at Stitch Fix’s peers in the consumer discretionary - apparel and accessories segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Movado delivered year-on-year revenue growth of 8.1%, beating analysts’ expectations by 5.4%, and Figs reported revenues up 28%, topping estimates by 4.7%. Movado traded up 19.3% following the results while Figs was down 24.3%.
Read our full analysis of Movado’s results here and Figs’s results here.
There has been positive sentiment among investors in the consumer discretionary - apparel and accessories segment, with share prices up 2% on average over the last month. Stitch Fix is up 11.1% during the same time and is heading into earnings with an average analyst price target of $4.60 (compared to the current share price of $3.65).
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