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Why 1-800-Flowers.com (FLWS) Is Down Today

Stocks in this article: FLWS

NEW YORK (TheStreet) -- 1-800-Flowers.com  (FLWS) was falling 5.85% to $5.01 on Tuesday afternoon on the first day of trading since the online florist's problematic Valentine's Day last week.

The massive snowstorm that swept across the East Coast late last week caused delivery problems for 1-800-Flowers and its peer companies, according to CNNMoney. Hundreds of customers took to social media to complain that their orders were not delivered on Valentine's Day, while others said the site's phone lines were jammed. Those who did get through noted that some of the orders had been cancelled and re-deliveries would not be available for multiple days.

A spokeswoman for the company told CNNMoney that the affected orders were a small fraction of the hundreds of thousands that the company processed for Valentine's Day.

1-800-Flowers apologized to its customers and offered some potential solutions, including reschedules, refunds and discounts on future orders.

Must Read: 5 Valentine's Day Apps for 2014

TheStreet Ratings team rates 1-800-FLOWERS.COM as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate 1-800-FLOWERS.COM (FLWS) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, revenue growth, attractive valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 33.17% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, FLWS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • 1-800-FLOWERS.COM has improved earnings per share by 8.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, 1-800-FLOWERS.COM increased its bottom line by earning $0.23 versus $0.19 in the prior year. This year, the market expects an improvement in earnings ($0.26 versus $0.23).
  • Despite its growing revenue, the company underperformed as compared with the industry average of 15.4%. Since the same quarter one year prior, revenues slightly increased by 6.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 41.67% is the gross profit margin for 1-800-FLOWERS.COM which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 6.76% is above that of the industry average.
  • You can view the full analysis from the report here: FLWS Ratings Report

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