Disclaimer: This is not a financial advise. The article has been published on February 12th 2022. Current stock price: $38.33 (close of day)
Movado Group, Inc. (Movado) designs, sources, markets, and distributes watches globally.
The company’s portfolio of watch brands comprises owned brands MOVADO, CONCORD, EBEL, OLIVIA BURTON, and MVMT as well as licensed brands COACH, TOMMY HILFIGER, HUGO BOSS, LACOSTE, and SCUDERIA FERRARI. In addition, the company also designs, sources, markets, and distributes jewelry and other accessories under certain of its brands.
Movado operates through two segments:
|Recent Price||US $38.33|
|Security No. (ISIN)||US6245801062
|Company Location||United States|
|52-week range||20.48 – 48.66|
|Fiscal year end||January|
|Price to Earnings||9.1|
|Price to Free Cash Flow||7.5|
|EV to EBIT||5.9|
|EV Free Cash Flow||6.4|
|Price to Book||1.8|
|Report Date||Fiscal Quarter||Forecast/EPS||Last Year’s EPS||EPS YoY Change|
|Mar 25, 2022||2021 (Q4)||0.80 / –||0.84||–|
|Nov 23, 2021||2021 (Q3)||1.01 / 1.36||0.7||94.29% (+0.66)|
|Aug 26, 2021||2021 (Q2)||0.30 / 0.85||-0.07||1314.29% (+0.92)|
|May 27, 2021||2021 (Q1)||-0.09 / 0.43||-0.56||176.79% (+0.99)|
For the nine months ended 31 October 2021, the company generated sales of US$ 526.4 million, up 60.7% from the US$ 328.1 million reported during the same period in 2020.
Watch and Accessory Brands segment reported a 55.6% increase in sales to US$ 456.8 million from US$ 293.6 million, the previous year.
The increase in net sales was primarily due to increased volumes resulting from higher demand with growth in the company’s wholesale customers, growth in online retailers, both in the company’s owned and wholesale customers’ e-commerce websites and to a lesser extent, limited price increases.
Prior period net sales were negatively impacted by restrictions affecting some stores of the company’s wholesale customers during a portion of the period due to the COVID-19 pandemic. Some of these restrictions have continued into fiscal 2022. Both the United States and international locations of the Watch and Accessory Brands segment reported an increase in sales during this period.
Sales from the Company Stores segment increased 101.9% to US$ 69.6 million from US$ 34.5 million, primarily as a result of increased traffic in the company’s retail stores, the addition of three new store openings, and MCS.com.
Operating income amounted to US$ 79.3 million during the nine months ended October 2021 compared to an operating loss of US$ 168.0 million during the same period in 2020. In 2020 the company wrote off US$155.9m in goodwill and certain intangible assets. The company reported a net income of US$ 60.2 million compared to a net loss of US$ 141.8 million, and earnings per share of US$ 2.59 compared to a loss per share of US$ 6.11, during the previous year.
Source: Movado Annual Reports
Following the good results during the first nine months, the company has increased its outlook for the fiscal year 2022 and has given the below guidance.
Movado Group Inc. highlighted that this updated outlook does not contemplate significant additional COVID-19 related retail closures which can adversely impact results
Movado Group Inc. will benefit from retail re-opening with Covid restrictions easing and recommendation is buy.
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