J Crew Group, Inc. (JCG) recently hit a new multi-year high above $50 after reporting a 19% earnings surprise in late May. This Zacks #2 rank stock has been on a roll over the last year, with an average earnings surprise of 40%.
First-Quarter Results
J Crew stepped up and reported solid Q1 results on May 27 that showcased the company’s growth in the resurgent consumer environment. Revenue for the period was up 20% from last year to $414 million. Earnings also came in strong at 68 cents, 19% ahead of the Zacks Consensus Estimate.
Same-store sales, a key retail metric, also looked great, up 15% from last year.
J Crew also scored big on controlling costs, with gross margin taking a big jump to 49% from 42% as the company scaled back on promotions in the improving consumer environment.
With operating income up 114% from last year to $75 million, J Crew’s cash position almost doubled, climbing to $332 million.
Estimates
Estimates haven’t exactly gone bonkers off the good quarter, but we have seen some upward movement none the less, with the current year adding 12 cents in the last month to $2.45 and the next year adding 10 cents to $2.77.
After the recent string of gains, JCG’s forward P/E of 18.6X is a premium to its peer’s 15X.
5-Year Chart
JCG has been mostly range bound since hitting a new multi-year high in late April. Look for support at the previous breakout area around $40 on any more weakness. Take a look below.
Read the March JCG article here
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Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Growth Trader Service.
