Destination Maternity Beats Estimates Yet Again

Seth Jayson, The Motley Fool
Updated

Destination Maternity (NAS: DEST) reported earnings on Jan. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q1), Destination Maternity missed on revenue and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue improved slightly, and earnings per share dropped significantly.

Margins contracted across the board.

Revenue details
Destination Maternity notched revenue of $136.4 million. The two analysts polled by S&P Capital IQ expected revenue of $140.3 million. Sales were 0.7% higher than the prior-year quarter's $135.4 million.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $0.17. The three earnings estimates compiled by S&P Capital IQ predicted $0.16 per share. GAAP EPS of $0.17 for Q1 were 58% lower than the prior-year quarter's $0.41 per share.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 51.0%, 290 basis points worse than the prior-year quarter. Operating margin was 3.3%, 370 basis points worse than the prior-year quarter. Net margin was 1.7%, 220 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $134.0 million. On the bottom line, the average EPS estimate is $0.29.

Next year's average estimate for revenue is $556.1 million. The average EPS estimate is $1.45.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 67 members out of 90 rating the stock outperform, and 23 members rating it underperform. Among 29 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 24 give Destination Maternity a green thumbs-up, and five give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Destination Maternity is outperform, with an average price target of $18.50.

Can your retirement portfolio provide you with enough income to last? You'll need more than Destination Maternity. Learn about crafting a smarter retirement plan in "The Shocking Can't-Miss Truth About Your Retirement." Click here for instant access to this free report.

At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement