NEW YORK (TheStreet) -- Shares of DSW Inc. (DSW) are advancing 0.97% to $35.35 in mid-morning trading Monday, after analysts at Credit Suisse increased their earnings estimates for the next three years.
The firm raised 2015 and 2016 earnings estimates to $1.90 and $2.12 from $1.87 and $2.06, respectively, with their 2017 earnings estimate set at $2.31 from $2.26 per share, Credit Suisse noted.
Second quarter sales remain solid that the team's efforts to reposition the assortment, value proposition and omni-channel offering has helped strengthen the company's competitive position, according to the analyst note.
"We believe DSW should be able to sustain comps in the near-term in the mid-single digit range vs. an assumption of 2-3%, providing stronger occupancy leverage and helping mitigate the ongoing investments in SG&A," Credit Suisse analysts said.
DSW is a footwear and accessories retailer that offers assortment of shoes, handbags and accessories for women and men.
Separately, TheStreet Ratings team rates DSW INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate DSW INC (DSW) a BUY. This is driven by a few notable strengths, 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 revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and increase in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- DSW's revenue growth has slightly outpaced the industry average of 9.1%. Since the same quarter one year prior, revenues slightly increased by 9.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- DSW has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.10, which illustrates the ability to avoid short-term cash problems.
- Powered by its strong earnings growth of 26.19% and other important driving factors, this stock has surged by 26.39% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DSW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- DSW INC has improved earnings per share by 26.2% 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, DSW INC increased its bottom line by earning $1.69 versus $1.64 in the prior year. This year, the market expects an improvement in earnings ($1.90 versus $1.69).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Specialty Retail industry average. The net income increased by 22.6% when compared to the same quarter one year prior, going from $38.64 million to $47.37 million.
- You can view the full analysis from the report here: DSW Ratings Report