Coldwater Creek Earnings: Here’s Why the Stock is Falling Now

Coldwater Creek Inc. (NASDAQ:CWTR) had a loss and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 17.88%.

Coldwater Creek Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.72 in the quarter versus EPS of $-0.56 in the year-earlier quarter.

Revenue: Decreased 8.55% to $149.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Coldwater Creek Inc. reported adjusted EPS loss of $0.72 per share. By that measure, the company missed the mean analyst estimate of $-0.63. It missed the average revenue estimate of $162.81 million.

Quoting Management: “Sales were lower than planned in the second quarter, largely due to a deceleration in traffic during the month of July. Despite a challenging environment, we delivered bottom-line results that were in line with our guidance,” said Jill Dean, President and Chief Executive Officer of Coldwater Creek. “Our return to more consistent comparable store sales has been slower than expected; however, we know that customer engagement and driving traffic are critical to our long-term success and two recent announcements represent progress against these objectives. First, we have further strengthened our management team with the addition of Deb Cavanagh as Chief Marketing Officer. In addition, our partnership with Alliance Data Systems provides us with an enhanced platform to drive sales and customer loyalty. We believe that these steps, combined with the extensive work we are continuing to do to align our merchandise assortment with our brand strategy, as well as our disciplined management of expenses and inventory, remain the right focus for our business.”

Key Stats (on next page)…

Revenue decreased 3.87% from $155.73 million in the previous quarter. EPS decreased to $-0.72 in the quarter versus EPS of $-0.66 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a loss of $0.37 and has not changed. For the current year, the average estimate is a loss of $2.12, which is the same with that ninety days ago.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)