Stage Stores Earnings Preview

Stage Stores (NYSE: SSI  ) came in right in line with the Street's expectations last quarter, but investors are hoping that it will beat them this quarter. The company will unveil its latest earnings on Thursday, August 18. Stage Stores operates specialty department store retailer offering moderately priced, nationally recognized, brand name and private label apparel, accessories, cosmetics, and footwear for the entire family.

What analysts say:

• Buy, sell, or hold?: Half of analysts think investors should stand pat on Stage Stores while the remaining half rate the stock as a buy. Analysts don't like Stage Stores as much as competitor Stein Mart overall. Three out of four analysts rate Stein Mart a buy compared to three of six for Stage Stores. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
• Revenue Forecasts: On average, analysts predict $354.5 million in revenue this quarter. That would represent a rise of 2.7% from the year-ago quarter.
• Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.29 per share. Estimates range from $0.28 to $0.29.

What our community says:
The majority of CAPS All Stars see SSI as a good bet, with 75% awarding it an "outperform" rating. The majority of the Fools are in agreement with the All Stars, with 66.7% give it an "outperform" rating. Fools are gung-ho about Stage Stores, though the message boards have been quiet lately with only 29 posts in the past 30 days. Stage Stores' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters:

Quarter	Q1	Q4	Q3	Q2
Gross Margin	24.6%	32.2%	23.1%	30.2%
Operating Margin	(0.3%)	12.2%	(3.7%)	4.8%
Net Margin	(0.1%)	7.0%	(2.1%)	3.0%

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