What to Expect From Express Earnings

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Express Inc. (NYSE: EXPR) is scheduled to report its fiscal second-quarter financial results before the markets open on Wednesday. In the first quarter, the company said that it delivered increased merchandise margin, expansion in gross margin and higher diluted earnings per share in line with guidance, but this was not enough. Since then, shares have more or less stayed in the range of $14 to $16, but could this be the quarter in which they break free?

The consensus estimates from Thomson Reuters call for $0.17 in earnings per share (EPS) on $520.95 million in revenue for the second quarter. The same period from last year reportedly had EPS of $0.25 and $535.58 million in revenue.

Previously, the company issued guidance for the second quarter. Express said it expects to have negative mid-single-digit comparable sales and EPS in the range of $0.15 to $0.19. In the first quarter, comparable sales for the quarter, including e-commerce sales, decreased by 3%. At the same time, e-commerce sales declined 1% to a total of $77 million.

Express said that second-quarter and full-year guidance reflect the challenges presented by the current retail environment. Looking ahead, management has said that the company remains focused on its key initiatives: delivering great fashion, acquiring new customers, optimizing inventory, implementing systems and maintaining a balanced financial architecture.

Prior to the release of the upcoming earnings report, a few analysts weighed in on Express:

  • BlueFin Research reiterated a Market Perform rating.
  • BMO Capital Markets reiterated a Market Perform rating.
  • D.A. Davidson reiterated a Neutral rating.
  • Wedbush has an Outperform rating with an $18 price target.
  • FBR has a Market Perform rating.
  • Mizuho has a Buy rating.
  • MKM Partners has a Neutral rating.
  • Stifel reiterated a Buy rating.

So far in 2016, Express has underperformed the broad markets, with the stock down about 9%. Looking at the past 52 weeks, the number is more or less the same.

Shares of Express were trading down 1% at $15.59 Tuesday morning, with a consensus analyst price target of $18.18 and a 52-week trading range of $13.25 to $21.57.