Coldwater Creek Earnings: An Early Look

Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Coldwater Creek (NASDAQOTH: CWTRQ  ) is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Coldwater Creek has not only had to deal with a challenging overall environment in the women's retail space but also has faced its own unique difficulties. Let's take an early look at what's been happening with Coldwater Creek over the past quarter and what we're likely to see in its quarterly report on Wednesday.

Stats on Coldwater Creek

Analyst EPS Estimate

($0.79)

Year-Ago EPS

($0.76)

Revenue Estimate

$218.8 million

Change From Year-Ago Revenue

2.9%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Will Coldwater Creek look prettier this quarter?
Coldwater Creek hasn't been able to convince analysts that it's likely to turn things around, as they've increased their loss estimates for the just-ended holiday quarter by more than $0.25 per share over the past few months, and have also added another dime to their fiscal-2014 loss projections. The stock has reflected that pessimism, plunging 40% since early December.

We've already gotten advance warning of just how bad Coldwater expects its holiday quarter to be. In a preliminary of results back in January, the retailer said same-store sales would come in flat from the year-ago quarter and gave a range for earnings per share that was $0.20 worse than previously expected. The company cited the need for substantial discounting as hurting margins, which has become all too common at Coldwater. Another bad sign for Coldwater is that its online sales have been dropping, bucking the trend of nearly every other retailer out there.

Other women's retailers throughout the industry have seen the same sort of headwinds, but not to the same extent. Ann Taylor parent ANN (NYSE: ANN  ) soared 8% on Friday after releasing better-than-expected results for its holiday quarter and a positive outlook, even though same-store sales for the quarter dropped 0.7%. Late last month, Chico's (NYSE: CHS  ) missed analyst projections for revenue but nevertheless saw profits climb as the company's restructuring efforts bore fruit.

In Coldwater's quarterly report, the key will be for new CEO Jill Brown Dean to step up and take control of the company's future strategic vision. As tough as leadership transitions can be in retail, Dean needs to find a better way forward for Coldwater Creek if the company expects to get out of its long malaise.

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