Jo-Ann Stores Inc. (JAS) recently reported preliminary fourth quarter earnings which were 34% higher than the Zacks Consensus Estimate. JAS has surprised on estimates 3 out of the last 4 quarters by an average of 59.47%.
Company Description
Jo-Ann Stores operates retail stores specializing in crafts, home decorating, and apparel and craft sewing in 47 states. The company sells craft projects, fabrics, frames, paper crafting material, home accents and seasonal home decor merchandise through both small-format and large format stores.
Jo-Ann Stores operated 554 small-format stores and 210 large-format stores as of Jan 31, 2009.
Jo-Ann Pre-Announced Better Than Expected Fourth Quarter Earnings
On Feb 4, Jo-Ann Stores announced preliminary fourth quarter earnings and sales results. The company expects earnings in the range of $1.32 to $1.34 per share which was far higher than the Zacks Consensus of $1.00 per share. Since the announcement, the Zacks Consensus has jumped to $1.33 per share.
Sales jumped 5.3% to $602.2 million from $571.9 million for the year ago period. Same-store sales also showed an increase, climbing 4.4% whereas in last year’s quarter as the economy really struggled, it decreased 2.9%.
Traffic also rose by 3% and the average ticket gained 1.4%.
Sales in the large-format stores rose 7.9% while small-format sales gained just 2.6% compared to the fourth quarter of 2008. However, same-store sales jumped 6.1% at the small-format compared to an increase of 3.1% at the large-format stores.
The only place the company struggled a bit was in joann.com, the company’s web site, which had flat sales compared to the year ago period.
Given the better-than-expected fourth quarter, the company also raised its fiscal 2010 earnings guidance to the range of $2.44 to $2.46 per share which was 35 cents higher than the Zacks Consensus of $2.11 per share.
2011 Zacks Consensus Also Jumped
With the bullish forecast for fiscal 2010, its not surprising that analysts also raised estimates for fiscal 2011.
5 estimates rose in the last 7 days. The Zacks Consensus jumped 15.85% to $2.85 per share. This is expected earnings growth of 15.79%.
Jo-Ann Stores will provide its first guidance for fiscal 2011 when it reports its official fourth quarter earnings on Mar 10.
Value Fundamentals
Jo-Ann Stores is a Zacks #1 Rank (strong buy) stock. The company is trading with a forward P/E of 12.74. Jo-Ann Stores has a a price-to-book ratio of 1.87.
Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service.
