NEW YORK (TheStreet) -- Michael Kors (KORS) soared 17.28% to $89.92, up $13.25 from its previous close of $76.67, at the close of the trading day on Tuesday after the apparel and handbag maker announced third-quarter earnings that far exceeded analysts' expectations.
The stock hit a one-year high of $93.02 on Tuesday and hit a low of $84.20 for the day; it has a one-year low of $51.63. Michael Kors had a volume of 21.56 million, more than four times its average of 3.9 million.
The company reported $1 billion in third-quarter revenue, which marks a 59% year-over-year increase and which well surpassed analysts' estimates of $860 million. Retail net sales grew 51.3% to $503.4 million thanks to an almost 28% increase in same-store sales and 98 new store openings since the end of the third quarter in 2013.
Third-quarter net income totaled $229.6 million for earnings per share of $1.11, a 73% year-over-year increase and nearly 30% greater than the consensus estimate of 86 cents per share.
"Michael Kors enjoyed an outstanding holiday season, as global brand awareness continued to drive strong demand for our luxury product," said Chairman and CEO John D. Idol in the company's statement. "Comparable stores sales increased 28% which exceeded our expectation and represents our 31st consecutive quarter of growth. We believe that our consistently strong performance is attributable to the creative vision of Michael Kors and his talented design team as well as the distinctive jet-set in-store experience that we provide in both our retail stores and our shop-in-shops. We remain very excited about our future growth prospects as Michael Kors continues to gain momentum as a global luxury lifestyle brand."
TheStreet Ratings team rates MICHAEL KORS HOLDINGS LTD as a Buy with a ratings score of B-. The team has this to say about their recommendation:
"We rate MICHAEL KORS HOLDINGS LTD (KORS) a BUY. This is driven by several positive factors, 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 robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value."
- You can view the full analysis from the report here: KORS Ratings Report