Why DSW Shares Popped

 Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of discount shoe retailer DSW (NYSE: DSW  ) were flying off the rack today, climbing as much as 11% today on an impressive earnings report.

So what: Adjusted earnings per share of $1.02 topped estimates of $0.89, while revenues improved 11.7% to $592.7 million. Same-store sales grew nicely as well at a 6.3% clip. CEO Mike MacDonald said he was pleased with the quarter, noting that it was the 13th consecutive period the company has shown positive comps and that it added a record 26 stores in the quarter. Management plans to increase store count by about 8% next year, adding 25 to 30 new locations.

Now what: This quarter marks the fifth in a row that the chain has beaten estimates. With an ambitious store expansion plan in place and a cost-efficient business model that avoids the usual hassle of shoe shopping by eliminating salesmen, DSW looks poised to continue delivering market-beating returns for investors. Notably, the company chose not to raise its 2012 guidance, but with 26 stores added last quarter it should cruise past the $3.31 analysts are expecting.

Don't miss the next deal on this company. Add DSW to My Watchlist.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2122117, ~/Articles/ArticleHandler.aspx, 10/31/2014 9:17:05 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement