Timberland Earnings Preview

Motley Fool Staff
Updated

Timberland (NYS: TBL) didn't hit the Street's expectations last quarter, but investors hope that it will rebound this quarter. The company will unveil its latest earnings on Thursday, Aug. 4. Timberland designs, develops, engineers, markets, and distributes premium-quality footwear, apparel, and accessories products for men, women, and children.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Timberland, with analysts unanimously rating it a hold. Analysts don't like Timberland as much as competitor Wolverine World Wide overall. Five out of 11 analysts rate Wolverine World Wide a buy, compared with zero of five for Timberland. While analysts still rate the stock a hold, they are a little more optimistic about it compared with three months ago.

  • Revenue forecasts: On average, analysts predict $208.6 million in revenue this quarter. That would represent a rise of 10.4% from the year-ago quarter.

  • Wall Street earnings expectations: The average analyst estimate is a loss of $0.40 per share. Estimates range from a loss of $0.46 to a loss of $0.36.

What our community says:
CAPS All-Stars are solidly backing the stock, with 82% awarding it an "outperform" rating. The community at large backs the All-Stars, with 80.4% assigning it a rating of "outperform." Fools are bullish on Timberland and haven't been shy with their opinions lately, logging 107 posts in the past 30 days. Despite the majority sentiment in favor of Timberland, the stock has a middling CAPS rating of three out of five stars.

Management:
Revenue has now gone up for three straight quarters. The company's gross margin shrank by three percentage points in the last quarter. Revenue rose 10.1% while cost of sales rose 16.7% to $185.7 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

46.8%

48.6%

47.8%

49.5%

Operating Margin

8%

12.6%

15.4%

(17.6%)

Net Margin

5.1%

8.6%

12.1%

(12.4%)

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

At the time thisarticle was published The Motley Fool owns shares of Timberland. Motley Fool newsletter services have recommended buying shares of Timberland.Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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