Archive for the ‘Consumer Discretionary Stocks’ Category

Collective Brands Inc. (PSS) ponders options, stock rockets

Thursday, August 25th, 2011

Collective Brands Inc. (NYSE: PSS) shares rose 19.8% to $12.32 after the parent of Payless and Stride Rite shoe stores said it would explore strategic options. Volume for the stock surmounted 4.8 million shares, or more than double its full-day average.

A news release out August 24 reported that the company, based out of Topeka, Kansas, said that as part of its efforts to optimize the performance of its Payless and Stride Rite store fleet, it would close approximately 475 under-performing and low-volume, non-strategic stores in the next three years with more than 300 of those closings coming by the end of this fiscal year.

The Company estimated that the costs for lease terminations, severance, and other exit costs related to closing these stores could be in the range of $25 million to $35 million.

The release also quoted CEO Michael Massey as saying, “While the second quarter was challenging for the company, we are taking aggressive actions to improve the business.

“In Payless Domestic, we are gaining a much greater understanding of our customers and their needs and expectations. With this clarity, we are taking short term actions to improve our performance, accelerating key initiatives, and adjusting our longer term strategies. At the same time, we will continue to invest for growth and profitability in our Performance + Lifestyle Group and international businesses.”

In the same release, investors could also see that net sales for the quarter ending July 30 increased 4.9% to $882.4 million. The second quarter 2011 net loss attributable to Collective Brands, Inc. was $35.0 million or $0.58 per diluted share. Excluding certain impairment and severance charges, adjusted net earnings attributable to Collective Brands were $9.9 million, or $0.16 per diluted share.

Eastman Kodak Co. (EK) gets lift from patent sale speculation

Thursday, August 18th, 2011

Eastman Kodak Co. (NYSE: EK) shares rallied 11.5% to $3.00, a day after The Wall Street Journal reported the company had begun exploring a possible sale of digital-imaging patents. Volume for the stock totaled 58.7 million shares, crushing a daily average of 13.1 million.

The Journal reported Wednesday that Kodak, through investment firm Lazard, had begun shopping around a portfolio of 1,100 patents. Kodak advertised the move a month ago, but investors appear to be paying closer attention now that Google Inc. said it would pay $12.5 billion to buy Motorola Mobility Holdings Inc., chiefly for its patents.

The Journal, citing anonymous sources, reported the patents have drawn interest from a “strategic buyer in the wireless industry looking to use the patents for defensive protection.”

Kodak declined to comment on the patent sale.

Zagg Inc. (ZAGG) zooms higher on bottom line

Tuesday, August 16th, 2011

Zagg Inc. (Nasdaq: ZAGG) shares climbed 6.6% to $15.70, on Monday after the maker of cellphones and accessories related to Apple Inc. (Nasdaq: AAPL) products hiked its 2011 revenue forecast and came out with second-quarter figures. Volume for the stock surpassed 5.4 million shares, compared to a daily average of 2.2 million.

A news release out August 15, declared that revenue for the second quarter was $38.8 million, a 158% increase from $15.1 million in the second quarter of 2010 and a 44% sequential increase as compared to $27.0 million in the first quarter of 2011. These results include nine days of iFrogz revenue of $2.4 million, having been acquired during the quarter on June 21, 2011. Revenue by channel was 72% indirect and 22% from the website.

Gross profit for the second quarter was $17.8 million, versus $7.5 million in Q2 2010 and $13.6 million from the previous quarter, which translates into gross margin for the quarter of 46%, versus 50% for Q2 2010 and 51% in the previous quarter. Gross margin for the quarter was in line with ZAGG’s guidance, but down year over year due to the required write up of iFrogz inventory, a product mix shift for iFrogz, additional shipping charges to meet higher than expected demand for iFrogz product, and an increase in obsolescence charges for ZAGG inventory.

The same release quoted CEO Robert Pedersen as saying, “ZAGG’s operational performance in the quarter was extremely strong. During the second quarter we saw revenue growth due to our expanding retail channel, and the increase in product we are putting into the channel. The market for smartphones and tablets continues to rapidly expand, and we are well positioned as a leading accessories provider, especially since our acquisition of iFrogz, which broadens our product offering, expands our distribution to new channels and brings the youth demographic into our mix.

“We are excited about the roll out of iFrogz product on our website, as well as the expansion of our tablet keyboard offerings with the ZAGGfolio™ and the new ZAGGkeys™ SOLO™. We feel that these additions will have an immediate impact to our online sales.”

The Company is raising its 2011 guidance for revenues to $160 million – $170 million, from a previous range of $105 million – $110 million, to reflect an improved outlook for the sale of its products as a result of expanding distribution and increased product offerings, and the acquisition of iFrogz.

Herbalife Ltd. (HLF) strengthens on announcing solid bottom line

Tuesday, August 2nd, 2011

Herbalife Ltd. (NYSE: HLF) shares climbed 7.5% to $59.68 after the nutritional-supplement seller projected third-quarter earnings that exceeded analysts’ estimates. Volume for the stock amounted to 6.2 million shares, towering over an all-day average of 1.8 million.

A news release out August 1 announced that second quarter net sales increased 27.7% and local currency net sales increased 19.9% compared to the same time period in 2010. Net income for the quarter of $111.2 million, or $0.88 per diluted share compares to 2010 second-quarter net income and EPS of $82.2 million and $0.65, respectively.

“We believe that we are just getting started,” the release quoted Michael O. Johnson, Herbalife CEO. “Eight consecutive quarters of growth in the average number of sales leaders ordering illustrates the engagement of the distributors and the strong foundation being built as Herbalife helps consumers tackle the global issues of obesity.”

For the quarter ended June 30, 2011, the company generated cash flow from operations of $142.7 million, an increase of 71.5% compared to the second quarter 2010, paid dividends of $23.9 million, invested $16.1 million in capital expenditures, and repurchased $98.8 million in common shares related to its share repurchase program.

Based in Los Angeles, Herbalife Ltd. is a global network marketing company that sells weight-management, nutrition, and personal care products intended to support a healthy lifestyle.

Skechers USA Inc. (NYSE: SKX) sprints ahead despite Q2 losses

Thursday, July 28th, 2011

Skechers USA Inc. (NYSE: SKX) shares climbed 20.2% to $17.18 after the sneaker maker late Wednesday reported larger-than-anticipated second-quarter losses. Volume for the stock topped 2.7 million shares, surpassing a daily average of 1.1 million.

A news release out July 27 showed that second-quarter 2011 net sales were $434.4 million compared to $504.9 million for the second quarter of 2010. Second-quarter 2011 net loss was $29.9 million or a loss of $0.62 per diluted share based on 48,341,000 weighted average common shares outstanding compared to net earnings of $40.2 million or earnings of $0.82 per diluted share based on 49,130,000 weighted average common shares outstanding for the second quarter of 2010.

“Second-quarter results were impacted by several factors,” the release quoted COO David Weinberg as saying. “First, we were up against a record second quarter in 2010, and we aggressively reduced our excess toning inventory during the second quarter by selling two million pairs of our original Shape-ups for a loss of $21.0 million. We also recorded a $4.4 million reserve for additional product, which we believe reflects net realizable value. We made a decision to accelerate the clearance on early generation Shape-ups product in order to eliminate the overhang of excess inventory.

“We believe this will expand the sales of our new toning and performance product, which are showing positive results at retail.” Weinberg  concluded.

Gross profit for the second quarter of 2011 was $143.3 million or 33%of net sales compared to $237.6 million or 47.1 percent of net sales in the second quarter of last year.

Skechers USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the Skechers name, as well as under several uniquely branded names.