Movado (MOV) shares gain on fourth quarter earnings and dividend hike

Movado Group, Inc. MOV released fourth quarter fiscal 2022 results, in which net income improved year-over-year and beat Zacks’ consensus estimate. In addition, turnover increased year on year.

Results achieved through strong execution of MOV’s strategies, including brand strength. Sales improved across its own and licensed brands; in the United States and internationally; and in its wholesale and direct-to-consumer units. Additionally, digital business has been consistently robust.

Movado shares gained 8.9% in the March 24 trading session. Over the past six months, this Zacks Rank #3 (Hold) stock has risen 8.1%, outpacing the industry’s 15.1% decline.

Q4 in detail

The company’s adjusted earnings per share jumped 56.5% year-over-year to $1.32, which also beat Zacks’ consensus estimate by 80 cents.

Movado Group Inc. Price, Consensus, and EPS Surprise

Movado Group Inc. price-consensus-eps-surprise-chart | Quote from Movado Group Inc.

Net sales increased 15.5% to $206 million, while growing 17.2% in constant currency (cc). This year-over-year growth was driven by improvements in wholesale customer physical stores, online retail and Movado company stores. Additionally, US net sales increased 18.5% year over year and international net sales increased 12.7%.

Adjusted gross profit was $120.8 million and adjusted gross margin was 54.9%, primarily due to favorable changes in channel and product mix as well as leverage from certain fixed costs on increased sales. These were partly offset by high shipping costs.

Adjusted operating income was $37.9 million, up from adjusted operating income of $23.9 million in the year-ago quarter.

Other Financial Updates

Movado ended the quarter with cash and cash equivalents of $277.1 million, inventory of $160.3 million and equity of nearly $472.8 million.

Additionally, MOV generated cash from operating activities of $130.8 million in fiscal 2022.

Movado repurchased 138,200 shares during the fourth fiscal quarter. MOV had shares worth $2.4 million as of January 31, 2022 under its March 25, 2021 share buyback program and all remaining $50 million under the program redemption date of November 23, 2021.

Additionally, Movado’s board approved a 40% hike in its quarterly cash dividend, bringing the amount to 35 cents per share from 25 cents. The new dividend is payable on April 20, 2022 to its shareholders of record on April 6.

Outlook

Management has issued guidance for fiscal year 2023. Net sales are projected in the range of $780-800 million, gross margin at around 58% and operating profit in the range of $125-130 million. dollars.

This view does not take into account the major impacts of higher inflation, geopolitical unrest, or pandemic-related impacts on supply chain and shipping costs. It assumes no fluctuation in foreign currency exchange rates.

Check out these strong retail stocks

Some higher ranked stocks are Capri Holdings CPRI, Tapestry TPR and Operation of the starter barn STARTUP.

Capri Holdings, which offers accessories and footwear, currently has a Zacks rank of No. 2 (buy). CPRI expects earnings per share growth of 53.9% over three to five years. You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks’ consensus estimate for Capri Holdings’ current-year EPS suggests growth of 215.8% over the corresponding figure for the prior year period. CPRI has a four-quarter earnings surprise of 1,018.2% on average.

Tapestry, a renowned designer of fine accessories, currently carries a Zacks ranking of 2. TPR has a trailing four-quarter earnings surprise of 28.2%, on average.

Zacks consensus estimate for Tapestry sales and EPS for the current year suggests growth of 17.5% and 22.9%, respectively, over the corresponding period of the prior year . TPR has an expected EPS growth rate of 12.5% ​​over three to five years.

Boot Barn Holdings, a retailer of western-style and workwear footwear, apparel and accessories, currently carries a No. 2 Zacks rank. BOOT has an expected EPS growth rate of 20% over three to five years.

Zacks’ consensus estimate for Boot Barn Holdings’ current year sales and EPS suggests growth of 62.6% and 220.8%, respectively, over the corresponding year-to-date figures. last year. BOOT has a trailing four-quarter earnings surprise of 47.1%, on average.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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