Kirkland’s, Inc. (KIRK) just hit a new 52-week high on the company’s better than expected Q4 results from mid March that included 10% sales growth and a 14% earnings surprise.
Company Description
Kirklands, Inc. operates as a specialty retailer of home decor in the United States. The company was founded in 1966, operates 279 stores in 34 states and has a market cap of $429 million.
Shares of Kirkland’s have been on amazing run for the last year, bottoming out in March of 2009 at the tail end of the financial crisis at around 80 cents. Since then, shares have topped off above $20 as the company focuses on closing under performing stores and driving operational efficiencies to boost earnings. The results showed up in Kirklands better than expected Q4 results from March 12.
Fourth-Quarter Results
Sales were up 6.9% from last year to $142.8 million. Comparable stores sales, a key retail metric, were up 10.2% as the company opened three new stores while closing 20. Earnings also came in strong at 92 cents, 14% ahead of the Zacks Consensus Estimate.
Kirkland’s was helped during the quarter on lower costs, with gross margin expanding to 45% from 39% from last year. As such, operating income almost doubled, jumping to $30 million from $16 million.
Estimates Advancing
The solid quarter and upward momentum lifted estimates, with the current year adding 21 cents to $1.51. The next-year estimate is up 30 cents to $1.70, a bullish 13%.
In spite of the recent gains, KIRK still has value, trading with a forward P/E multiple of 14X.
The Chart
Shares of KIRK recently hit a new 52-week high after jumping above some short-term resistance at $19. Take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Surprise Trader Service. Zacks Investment Research
