Pier 1 Imports Inc. (NYSE: PIR) released its fiscal fourth-quarter financial report Wednesday after the market closed. The company had $0.39 in earnings per share (EPS) on $543.6 million in revenue, versus Thomson Reuters consensus estimates of $0.36 in EPS and $548.71 million in revenue. In the same period from the previous year it had $0.41 in EPS and $515.79 million in revenue.
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The company gave guidance for the fiscal first quarter as comparable store sales growth of 4% from the previous year and EPS in the range of $0.07 to $0.08. There are consensus estimates of $0.12 in EPS and $438.96 in revenue.
Merchandise margin –the result of adding back delivery, fulfillment and store occupancy costs to gross profit– in the fourth quarter was $302.1 million, or 55.6% of total sales, versus $292.0 million, or 56.6% of total sales in the fourth quarter of fiscal 2014.
The board of directors declared a $0.07 per share quarterly cash dividend on the outstanding shares of common stock. The cash dividend will be paid on May 6, 2015, to shareholders of record on April 22. The previous quarterly dividend was $0.06 per share.
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Pier 1 plans to close approximately 100 stores over the next three years, primarily through natural lease expirations and relocations.
Alex W. Smith, president and CEO, said:
Our omni-channel transformation is largely complete and from a brand strength and customer facing perspective we could not be more pleased with the results. However, fiscal 2015 clearly did not turn out as we had originally budgeted and we are very disappointed with the result. Our job now is to use the strength of the Pier 1 Imports brand and our investments in it to improve our profitability.
Ahead of the earnings report, a couple of analysts weighed in on Pier 1 with somewhat mixed views:
- Wedbush had Neutral rating for Pier 1 and a price target of $13.50, implying upside of 8% from current prices.
- Morgan Stanley downgraded the stock to an Underweight rating from Equal Weight and lowered the price target to $11 from $13, implying downside of nearly 12%.
The stock has a consensus analyst price target of $14.88.
Wednesday, Pier 1 shares closed down 0.2% at $12.65. Following the release of the earnings report, shares traded up 2% at $12.90, in a 52-week trading range of $11.38 to $19.39.
Investors might be looking for more of a drop out of Pier 1, but this stock has already lost about one-third of its value since last June.
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