Michaels Slides Despite Strong Q3 Results
When Michaels Companies Inc. (NASDAQ: MIK) released its fiscal third-quarter financial results before the markets opened on Thursday, the retailer said that it had $0.48 in earnings per share (EPS) and $1.27 billion in revenue. Consensus estimates had called for $0.44 in EPS and revenue of $1.25 billion, and in the same period of last year the company said it had EPS of $0.44 and $1.24 billion in revenue.
During the most recent quarter, total net sales increased 2.7%. The increase in net sales was primarily due to a 3.8% increase in comparable store sales and the operation of 19 additional Michaels stores in this time.
Looking ahead to the fiscal fourth quarter, the company expects to see EPS in the range of $1.42 to $1.47 with comparable sales flat, give or take 0.5%. Consensus estimates call for $1.41 in EPS and $1.8 billion in revenue.
On the books, Michaels cash and cash equivalents totaled $102.67 million at the end of the quarter, down from $425.90 million at the end of the previous fiscal year.
Chuck Rubin, board chair and chief executive, commented:
Today we reported better-than-expected third quarter results, driven by stronger comparable store sales growth, good expense management and the impact of our ongoing share repurchase program. Supported by a compelling assortment, stronger marketing and a more integrated omnichannel experience, our teams are engaged and excited to serve customers this holiday season, both in stores and online. We have invested significantly this year to create an easier shopping experience for customers, and we believe these improvements will strengthen our leadership position in the Arts & Crafts industry and help us deliver our revenue and earnings expectations for the year.
Shares of Michaels were last seen down 3% at $15.94, in a 52-week range of $14.82 to $27.87. The consensus analyst price target is $21.36.
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