DSW Earnings Cheat Sheet: Fifth Consecutive Quarter of Double-Digit Growth

DSW Inc. (NYSE:DSW) reported net income above Wall Street’s expectations for the first quarter. DSW Inc. is a branded footwear specialty retailer in the U.S.

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DSW Earnings Cheat Sheet for the First Quarter

Results: Net income for DSW Inc. rose to $38.4 million (85 cents/share) vs. $30.2 million (67 cents/share) in the same quarter a year earlier. A rise of 27.2% from the year earlier quarter.

Revenue: Rose 12% to $503.6 million YoY.

Actual vs. Wall St. Expectations: DSW beat the mean analyst estimate of 75 cents/share. Estimates ranged from 73 cents per share to 76 cents per share.

Quoting Management: “We have had a strong start to the year, recording double-digit gains in net sales and comparable sales and a 29% increase in operating profit as compared to the first quarter last year, continuing our stellar performance from 2010,” stated Mike MacDonald, President and Chief Executive Officer, DSW Inc. “We attribute our ongoing strength to the successful execution of our key growth initiatives, and the increasing importance and attachment to the DSW brand by consumers. During the quarter, DSW achieved balanced growth across categories and genders with accessories and men’s leading the way. Our new stores performed well and we were also pleased with the growth in our leased business division, which generated its highest quarterly sales in over four years.”

Key Stats:

The company has enjoyed double-digit year-over-year revenue growth for the past five quarters. Over that span, the company has averaged growth of 13.5%, with the biggest boost coming in the first quarter of the last fiscal year when revenue rose 16.5% from the year earlier quarter.

The company has now seen net income rise in three-straight quarters. In the fourth quarter of the last fiscal year, net income rose 37.9% and in the third quarter of the last fiscal year, the figure rose 33.4%.

Gross margins expanded last quarter, rising 1.4 percentage points to 34.2% from the year earlier quarter. This snaps a streak of two consecutive quarters of shrinking margins.

Competitors to Watch: Collective Brands Inc. (NYSE:PSS), Genesco Inc. (NYSE:GCO), Foot Locker, Inc. (NYSE:FL), Shoe Carnival, Inc. (NASDAQ:SCVL), Bakers Footwear Group Inc (BKRS), The Finish Line, Inc. (NASDAQ:FINL), Prima Moda S.A. (NYSE:PMA), Deckers Outdoor Corp. (NASDAQ:DECK), NIKE, Inc. (NYSE:NKE), Skechers USA, Inc. (NYSE:SKX), The Timberland Company (NYSE:TBL), Crocs (NASDAQ:CROX), Under Armour (NYSE:UA), Wolverine World Wide, Inc. (NYSE:WWW), Steven Madden, Ltd. (NASDAQ:SHOO), LaCrosse Footwear, Inc. (NASDAQ:BOOT), Brown Shoe Company, Inc. (NYSE:BWS), and Phoenix Footwear Group, Inc. (AMEX:PXG).

Stock Performance: Shares of DSW are up almost 8.5% this morning from the previous close of $43.19.

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