Ascena Retail Group Outruns Estimates Again

Seth Jayson, The Motley Fool
Updated

Ascena Retail Group (NAS: ASNA) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Jan. 28 (Q2), Ascena Retail Group beat expectations on revenues and crushed expectations on earnings per share.

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

Margins expanded across the board.

Revenue details
Ascena Retail Group logged revenue of $862 million. The nine analysts polled by S&P Capital IQ predicted revenue of $828.5 million on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $752.2 million.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.81. The 10 earnings estimates compiled by S&P Capital IQ forecast $0.67 per share. GAAP EPS of $0.81 for Q2 were 56% higher than the prior-year quarter's $0.52 per share.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 41.5%, 50 basis points better than the prior-year quarter. Operating margin was 11.6%, 180 basis points better than the prior-year quarter. Net margin was 7.4%, 170 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $783.2 million. On the bottom line, the average EPS estimate is $0.77.

Next year's average estimate for revenue is $3.17 billion. The average EPS estimate is $2.68.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 227 members rating the stock outperform and 30 members rating it underperform. Among 87 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 82 give Ascena Retail Group 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 Ascena Retail Group is outperform, with an average price target of $37.09.

If you're invested in retailers like Ascena Retail Group, you should check out the concept that is The Motley Fool's top stock for 2012. Its founder wrote the book on big box retailing, and it's growing in increasingly important international markets. 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