Kirkland's Earnings Preview

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Investors braced for a bumpy ride ahead of Kirkland's (NAS: KIRK) earnings announcement as the company has wavered between beating and falling short of analyst predictions during the past fiscal year. The company will unveil its latest earnings on Thursday, March 8. Kirkland is a retailer of home decor in the United States with stores that present a selection of merchandise, including framed art, mirrors, wall decor, candles, lamps, decorative accessories, and garden accessories.

What analysts say:

  • Buy, sell, or hold?: Half of analysts think investors should stand pat on Kirkland's while the remaining half rate the stock as a buy. Analysts don't like Kirkland's as much as competitor Pier 1 Imports overall. Eight out of 10 analysts rate Pier 1 Imports a buy compared to two of four for Kirkland's. Kirkland's' rating hasn't changed over the past three months.
  • Revenue forecasts: On average, analysts predict $148.5 million in revenue this quarter. That would represent a rise of 6.4% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.74 per share. Estimates range from $0.74 to $0.75.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 92.6% granting it an "outperform" rating. Most of the community agrees with the All-Stars, with 84.4% assigning it a rating of "outperform." Despite the majority sentiment in favor of Kirkland's, the stock has a middling CAPS rating of three out of five stars.

Management:
Revenue has now gone up for three straight quarters.

Now let's get some insight into how efficient management is at running the business. Margins are a representation of how efficiently a company captures portions of sales dollars. The company's net margins have been decreasing year-over-year for the last four quarters. Net margins reflect what percentage of revenue becomes profit. Here is how Kirkland's has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

37.2%

34.4%

40.3%

42.3%

Operating Margin

2.0%

(0.7%)

5.5%

15.9%

Net Margin

1.3%

(0.5%)

3.4%

10.3%

One final thing: If you want to keep tabs on Kirkland's movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

At the time this article was published

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