A trio of very strong retail earnings this morning, but guidance tells a different story.
Walmart, Under Armour and Canada Goose all reported better-than-expected profits. But the retailers' outlooks ranged from somewhat cautious to downright disappointing.
Walmart expects second quarter earnings per share of 62-65 cents, roughly in line with the consensus estimate of 64 cents despite just posting its biggest earnings beat in three years.
Under Armour fiscal fourth quarter earnings beat by 3 cents, but its profit forecast of 18-21 cents in the new fiscal year is a fraction of the 59 cents the Street has been expecting. The athletic gear firm also sees a shocking low double-digit decline in revenues, while analysts were expecting a 2% rise. The company blames "lower wholesale channel demand and inconsistent execution across our business" for the weak guidance.
Canada Goose latest fiscal fourth quarter earnings were more three times greater than the Street's expectations. But its outlook for the new fiscal year was far more tempered as it expects "global consumer spending will continue to be pressured." The outdoor apparel maker projects mid-teens earnings growth vs. Wall Street's expectation of up 20.6%. and revenue growth of up low single digits vs. an estimate of up 8.1%. An even bigger problem though – the company has withdrawn its long-term financial targets amid the "more challenging consumer spending environment" that has caused its direct-to-consumer and wholesales businesses to "have not performed according to our expectations."
— Robert Hum