Looking back on apparel retailer stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including American Eagle (NYSE:AEO) and its peers.
Apparel sales are not driven so much by personal needs but by seasons, trends, and innovation, and over the last few decades, the category has shifted meaningfully online. Retailers that once only had brick-and-mortar stores are responding with omnichannel presences. The online shopping experience continues to improve and retail foot traffic in places like shopping malls continues to stall, so the evolution of clothing sellers marches on.
The 9 apparel retailer stocks we track reported a satisfactory Q3. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 2.1% below.
While some apparel retailer stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.8% since the latest earnings results.
American Eagle (NYSE:AEO)
With a heavy focus on denim, American Eagle Outfitters (NYSE:AEO) is a specialty retailer offering an assortment of apparel and accessories to young adults.
American Eagle reported revenues of $1.29 billion, flat year on year. This print fell short of analysts’ expectations by 1.2%. Overall, it was a slower quarter for the company with a miss of analysts’ EBITDA estimates.
“Building on our positive performance in the first half of the year, third quarter results provide another proof point of the effectiveness of our Powering Profitable Growth Plan. Led by a strong back-to-school season, we achieved comparable sales growth across brands and channels, and delivered adjusted operating income at the high end of our guidance range,” commented Jay Schottenstein, AEO’s Executive Chairman of the Board and Chief Executive Officer.
The stock is down 30.2% since reporting and currently trades at $14.35.
Read our full report on American Eagle here, it’s free.
Best Q3: Urban Outfitters (NASDAQ:URBN)
Founded as a purveyor of vintage items, Urban Outfitters (NASDAQ:URBN) now largely sells new apparel and accessories to teens and young adults seeking on-trend fashion.
Urban Outfitters reported revenues of $1.36 billion, up 6.3% year on year, outperforming analysts’ expectations by 1.7%. The business had an exceptional quarter with a solid beat of analysts’ gross margin estimates and an impressive beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 40% since reporting. It currently trades at $56.19.
Is now the time to buy Urban Outfitters? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Torrid (NYSE:CURV)
Promoting a message of body positivity and inclusiveness, Torrid Holdings (NYSE:CURV) is a plus-size women’s apparel and accessories retailer.
Torrid reported revenues of $263.8 million, down 4.2% year on year, falling short of analysts’ expectations by 6.6%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
Torrid delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. Interestingly, the stock is up 36.3% since the results and currently trades at $6.31.
Read our full analysis of Torrid’s results here.
Zumiez (NASDAQ:ZUMZ)
With store associates called “Zumiez Stash Members”, Zumiez (NASDAQ:ZUMZ) is a specialty retailer of street and skate apparel, footwear, and accessories.
Zumiez reported revenues of $222.5 million, up 2.8% year on year. This print was in line with analysts’ expectations. Overall, it was a strong quarter as it also put up a solid beat of analysts’ EPS and EBITDA estimates.
The stock is down 21.6% since reporting and currently trades at $15.77.
Read our full, actionable report on Zumiez here, it’s free.
Gap (NYSE:GAP)
Operating under the Gap, Old Navy, Banana Republic, and Athleta brands, Gap (NYSE:GAP) is an apparel and accessories retailer selling casual clothing to men, women, and children.
Gap reported revenues of $3.83 billion, up 1.6% year on year. This result topped analysts’ expectations by 0.6%. It was an exceptional quarter as it also produced a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ EPS estimates.
The stock is up 3.7% since reporting and currently trades at $22.86.
Read our full, actionable report on Gap here, it’s free.
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