J.Crew Group, Inc. (JCG) analysts are raising expectations following a great earnings report as the company continues to demonstrate excellent fundamentals.

Company Description

J.Crew Group is a well-known apparel company. The company sells clothing, shoes and accessories through about 300 retail locations, its catalog and website.

Revenues up 19%

On Mar 9 J.Crew reported quarterly results that included revenues of $461 million, up 19%, driven by a 17% increase in same-store sales.

Net income came in at just over $40 million, or 61 cents per share. EPS was 15 cents ahead of expectations, giving the Zacks #1 Rank stock its sixth earnings surprise.

Estimates Surpass Guidance

Since the announcement, we have seen the Zacks Consensus Estimate for fiscal 2011 rise 21 cents to $2.32. This is 2 cents higher than high end of J.Crew’s forecast.

Estimates for next year are averaging $2.66, up 29 cents. Given these levels, the expected earnings growth is 20% this year and 15% next year.

Ahead of the Pack

J.Crew boasts a ROE of more than 40%, trumping the competition, which averages 8%. The company’s profit margin, 7.8%, is also well in front of the 1.8% its peers average.

The Chart

Shares dipped following the report, but this was likely profit taking after the sizable run up prior to the announcement. The stock has stabilized since and the growth is fairly priced, with a PEG of 1.0 times.

J.Crew Group, Inc. - ticker JCG > <P ALIGN=

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service Zacks Investment Research