Abercrombie & Fitch Earnings Cheat Sheet: Revenue Strengthens Again by Double-Digits

S&P 500 (NYSE:SPY) component Abercrombie & Fitch (NYSE:ANF) reported higher profit for the third quarter as revenue showed growth. Abercrombie & Fitch is an American specialty retailer company that, through its wholly-owned subsidiaries, operates stores and direct sales of casual apparel for men, women, and children.

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Abercrombie & Fitch Earnings Cheat Sheet for the Third Quarter

Results: Net income for Abercrombie & Fitch rose to $50.9 million (57 cents per share) vs. $50 million (56 cents per share) in the same quarter a year earlier. This marks a rise of 1.7% from the year earlier quarter.

Revenue: Rose 21.5% to $1.08 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: ANF fell short of the mean analyst estimate of 73 cents per share. Analysts were expecting revenue of $1.07 billion.

Quoting Management: “While our results for the third quarter were impacted by costing challenges combined with greater uncertainty in the macroeconomic environment, we remain very confident in our strategy, the underlying strength of our brands and our ability to create long-term shareholder value. Our focus remains on execution against our long-term strategy and roadmap objectives,” said Mike Jeffries, Chief Executive Officer and Chairman of the Board.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 21.8%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 27.3% from the year earlier quarter.

Gross margin shrank 3.6 percentage points to 60.1%. The contraction appeared to be driven by increased costs, which rose 33.6% from the year earlier quarter while revenue rose 21.5%.

The company fell short of forecasts after beating estimates in the previous two quarters. In the second quarter, it topped the mark by 6 cents, and in the first quarter, it was ahead by 16 cents.

Looking Forward: Over the past ninety days, the average estimate for the fourth quarter has fallen from $1.85 per share to $1.75, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is $3.08 per share, falling from $3.27 thirty days ago.

Competitors to Watch: Urban Outfitters, Inc. (NASDAQ:URBN), American Eagle Outfitters (NYSE:AEO), The Buckle, Inc. (NYSE:BKE), Aeropostale, Inc. (NYSE:ARO), The Gap Inc. (NYSE:GPS), Pacific Sunwear of California, Inc. (NASDAQ:PSUN), dELiA*s, Inc. (NASDAQ:DLIA), Zumiez Inc. (NASDAQ:ZUMZ), The Wet Seal, Inc. (NASDAQ:WTSLA), and The Walking Co. Hldgs., Inc. (WALK).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)