True Religion Apparel Misses Where it Counts

True Religion Apparel (Nasdaq: TRLG  ) reported earnings on July 29. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), True Religion Apparel beat slightly on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue grew. GAAP earnings per share dropped significantly.

Margins shrank across the board.

Revenue details
True Religion Apparel chalked up revenue of $116.6 million. The five analysts polled by S&P Capital IQ expected sales of $115.0 million on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $104.9 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 $0.33. The six earnings estimates compiled by S&P Capital IQ anticipated $0.39 per share. GAAP EPS of $0.33 for Q2 were 15% lower than the prior-year quarter's $0.39 per share.

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 61.8%, 250 basis points worse than the prior-year quarter. Operating margin was 13.3%, 260 basis points worse than the prior-year quarter. Net margin was 7.2%, 210 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $131.5 million. On the bottom line, the average EPS estimate is $0.51.

Next year's average estimate for revenue is $517.1 million. The average EPS estimate is $1.81.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 473 members out of 545 rating the stock outperform, and 72 members rating it underperform. Among 153 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 133 give True Religion Apparel a green thumbs-up, and 20 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on True Religion Apparel is hold, with an average price target of $32.00.

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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. The Motley Fool has no position in any of the stocks mentioned. 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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