Pier 1 Imports Inc (NYSE:PIR)’s Q2 reports holds fear quotient

Posted by admin September 20, 2013 0 Comment 624 views

Thursday dawned and so did an almost horror-moment for Pier 1 Imports Inc (NYSE:PIR) investors. The company announced a 32% plunge in its fiscal Q2 profits and also chopped its guidance for the full year.

Thursday’s trading

In Thursday’s trading session Pier 1 Imports Inc (NYSE:PIR) crashed 13.86% on the news. The opening price of the shares was $21.36, which rose to an intraday high of $21.60 and dipped to close at $20.33. Approximately 14.63 million shares exchanged hands over the course of Thursday’s trading. The average volume of shares traded over a period of 30 days was 1.32 million. The 52-week low of Pier 1 Imports Inc (NYSE:PIR) shares is $18.05 and the 52-week high is $25.28. The company has a market cap of $2.18 billion.

The report

Pier 1 Imports Inc (NYSE:PIR) announced that in the last quarter its earnings per share were 17 cents or $17.8 million, in comparison to an EPS of 24 cents per share or $26.2 million in the previous year. With the exclusion of one-time items, its earnings were 19 cents/share which fell behind analyst projections by 2 pennies.

There was a 7.6% increase in sales to $395.6 million which was just under analyst estimates of $405M. There was a 3.5% rise in same-store sales or around 50% of the 6.7% growth in same period of last year. Gross margins dropped from 41.2% to 40.8%. The company has expenses of upto $122.6 million which amounted to 31% of its sales. The company’s Chief Executive Officer cited their marketing initiative that he said did not have proper messaging around sales clearance and customer acquisition. This is what affected the store traffic.

Looking forward, Pier 1 Imports Inc (NYSE:PIR) has projected a $1.23-$1.29 EPS for the full year in comparison with the earlier guidance of $1.27-$1.33. The higher end of new-range will still be 2 pennies under analyst projections

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