Ruby Tuesday Earnings: Here’s Why the Stock is Falling Now

Ruby Tuesday, Inc. (NYSE:RT) delivered a profit 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 6.94%.

Ruby Tuesday, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 53.85% to $0.12 in the quarter versus EPS of $0.26 in the year-earlier quarter.

Revenue: Decreased 12.97% to $316.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Ruby Tuesday, Inc. reported adjusted EPS income of $0.12 per share. By that measure, the company missed the mean analyst estimate of $0.19. It missed the average revenue estimate of $332.17 million.

Quoting Management: JJ Buettgen, President and CEO, commented, “Fiscal 2013 was a transitional year for Ruby Tuesday as we made a number of strategic decisions and investments which will strengthen our Company longer-term. We exited our non-core concepts; significantly improved the strength of our senior management team by adding a new VP of Culinary and Beverage, a new SVP of Finance, a new SVP/Chief Development Officer, and most recently a new President Ruby Tuesday concept/Chief Operations Officer; and made significant progress on our strategy and plans to transform Ruby Tuesday into a more broadly appealing, vibrant, and energetic brand. While we are disappointed with our financial results for the fourth quarter and the year, we are confident and excited about our future and the changes we are making to the Ruby Tuesday brand. Our brand transformation initiatives include significant enhancements to our menu, service, atmosphere, and marketing. Although we are in the initial stages of our brand transformation efforts, we made meaningful progress during the quarter and as we execute on these plans, we are confident that over time we will realize improvements in our guest counts, same-restaurant sales, and profitability.”

Key Stats (on next page)…

Revenue increased 2.84% from $307.38 million in the previous quarter. EPS increased 20% from $0.10 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.06 to a profit $0.08. For the current year, the average estimate has moved down from a profit of $0.28 to a profit of $0.27 over the last ninety days.

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

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