Men's Wearhouse Meets on the Top Line, Misses Where It Counts

Men's Wearhouse (NYSE: MW  ) reported earnings on June 6. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended April 28 (Q1), Men's Wearhouse met expectations on revenue and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue increased slightly and GAAP earnings per share didn't change.

Gross margin improved, operating margin dropped, and net margin contracted.

Revenue details
Men's Wearhouse reported revenue of $586.6 million. The six analysts polled by S&P Capital IQ anticipated a top line of $594.7 million on the same basis. GAAP reported sales were 1.1% higher than the prior-year quarter's $580.4 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.52. The seven earnings estimates compiled by S&P Capital IQ averaged $0.55 per share. GAAP EPS of $0.52 were the same as the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 43.3%, 80 basis points better than the prior-year quarter. Operating margin was 7.0%, 60 basis points worse than the prior-year quarter. Net margin was 4.6%, 10 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $677.3 million. On the bottom line, the average EPS estimate is $1.22.

Next year's average estimate for revenue is $2.51 billion. The average EPS estimate is $2.85.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS. Among 79 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 64 give Men's Wearhouse a green thumbs-up, and 15 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Men's Wearhouse is outperform, with an average price target of $44.67.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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