$KORS Management will raise guidance by $.20 at least. KORS will make new highs on Wednesday. All analysts will raise their price targets.? Rick (@upod2013) May. 23 at 07:31 PM
The Kors luxury retail brand will report fourth quarter and fiscal 2014 earnings on Wednesday, May 28, before the market open. Analysts expect 68 cents in earnings per share on $815.30 million in sales, according to stats on Yahoo! Finance. The consensus price target is $100.65. Shares traded at $98 at 9:45 a.m. on Tuesday.
Traders on Stocktwits.com are pretty positive on the stock. Sentiment is 97% bullish, according to site analytics.
It's not difficult to understand why. Michael Kors has seen explosive growth. Last quarter, revenue rose 59% from the same period a year ago, to $1 billion. Profits climbed an even higher -- up 61.6% to $619.5 million. The stock jumped more than 18% as a result.
Management has attributed Kors' growth to better brand awareness in Europe, where sales grew nearly 145%, and accessory sales in the U.S.
This time around, expectations are even higher. Many investors anticipate that management will raise fiscal 2014 EPS forecasts beyond the $3.07 to $3.09 guided to last quarter. They anticipate same-store sales will climb more than 25%, topping the $3.18 billion to $3.19 billion guided to last quarter. In fact, consensus estimates on Yahoo! Finance call for fiscal 2014 EPS of $3.12 on $3.21 billion in sales.
@readytoinvest KORS was up more than 20% afterFebruary EPS report. This 1/4 won't be as big a blowout. Raised guidance will move the stock? Rick (@upod2013) May. 26 at 02:44 PM
The high expectations have some investors concerned about a disappointment. Anything less than stellar results could provoke a selloff, some argue.
@Mikkoi ER Wednesday. thats the bus driver... Might inch higher into report.. but report has to be spectacular or it gets crushed? Joey S (@Joerazorback) May. 23 at 04:05 PM
But most investors on Stocktwits.com believe Kors can impress, especially given the outperformance of other luxury retail brands, such as Tiffany's (TIF). If Tiffany is any indication, wealthy consumers worldwide are still shelling out for brand name bling. And Michael Kors' watches -- priced above $200 -- qualify as higher-end.
Moreover, retailers that sell Kors' jewelry and handbags have reported better-than-expected results. Macy's (M) which also owns Bloomingdale's, beat on EPS last quarter -- though revenues came in shy of consensus estimates. But, more importantly, the retailer reiterated bullish EPS guidance for fiscal 2014 of between $4.40 and $4.50. Macy's management said full-year sales would grow between 2.5% and 3%, to more than $29 billion, given the midpoint of that range.
And Kors' sales in Europe show good things. Bloomberg reported last month that Parisians are trading in their Louis Vuitton bags for the more affordable Kors brand.
$KORS Any potential earning disappointment ( very minor chance) will be ignored for excellent guidance. Brand is just warming up.? j sciacca (@jjshaka) May. 26 at 10:13 PM
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At the time of publication the author held no positions in any of the stocks mentioned.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.