Pier 1 Imports (PIR) Stock Price Target Lowered at Nomura
NEW YORK (TheStreet) -- Pier 1 Imports' (PIR) - Get Report stock price target was reduced to $8.50 from $10 at Nomura on Friday morning. The firm has a "buy" rating on the shares.
The new price target comes after the home furnishings retailer reported weaker-than-expected results for the 2017 fiscal first quarter earlier this week.
The Fort Worth, TX-based company posted a loss of 7 cents per share, wider than the loss of 5 cents per share that analysts had projected. Revenue fell 4.2% to $418.4 million from last year and was below estimates of $420.1 million.
"We believe that the company's merchandise margin targets are achievable, especially in the absence of costs related to the distribution center inefficiencies that weighed down margin last year, and management remains keenly focused on this metric," Nomura wrote in an analyst note.
"That said, we are taking down our estimates for the remainder of the year, due to a more muted sales outlook, but still believe trends will improve across most metrics in the back half," the firm added.
Nomura reduced its fiscal 2017 earnings per share estimate to 35 cents from 48 cents and its fiscal 2018 earnings per share expectation to 55 cents from 65 cents.
The firm also said to be cautious on shares due to several factors, including challenges in the outdoor category, a slowdown in store-related online sales and uncertainty surrounding the return on the recently increased investment in marketing.
Shares of Pier 1 closed at $5.14 on Thursday.
Separately, TheStreet Ratings Team has a "Hold" rating with a score of C on the stock.
The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures.
But the team also finds weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: PIR