Home Furnishings Retailer Kirkland's Stock Climbs As It Forecasts Stronger Profitability In Q4: Details
Portfolio Pulse from Anusuya Lahiri
Kirkland's Inc (NASDAQ:KIRK) reported Q3 FY23 sales of $116.4 million, below the consensus of $121.0 million. The adjusted EPS loss of $(0.45) was better than the expected $(0.53) loss. Comparable same-store sales decreased by 9.2%, with e-commerce sales down 8.5% Y/Y. Gross profit margin improved to 26.3% from 25.0% due to better merchandise margin. Adjusted EBITDA loss widened to $(3.2) million from $(1.7) million Y/Y. The company has $5.8 million in cash and $62.0 million in debt. Interim CEO Ann Joyce expects improved profitability in Q4 and a return to historical average adjusted EBITDA margin. Kirkland's stock has lost 26.1% YTD but is trading up 7.82% at $2.62 in premarket.
November 30, 2023 | 12:59 pm
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Kirkland's reported lower than expected Q3 sales but a smaller EPS loss than anticipated. The company sees an improved profitability outlook for Q4, which has led to a premarket stock price increase.
Despite the sales miss and year-to-date decline, the stock is reacting positively to the better-than-expected EPS loss and the optimistic profitability forecast for Q4. This suggests a potential short-term bullish sentiment among investors.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 100