Why Tumi Holdings Shares Tanked

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 travel and business products specialist Tumi Holdings (NYSE: TUMI  ) plunged 11% today after its quarterly results and outlook missed Wall Street expectations.

So what: Tumi's second-quarter EPS of $0.18 was pretty much in line with estimates, but a wide miss on the top line -- revenue of $108.2 million versus the consensus of $114 million -- coupled with downbeat guidance for the full year reinforces concerns over slowing growth going forward. In fact, same-store sales increased just 4.6% compared to an 8% jump in the year-ago period, suggesting that its rivals are making some market share headway.

Now what: Management now sees full-year EPS of $0.76 to $0.82 on revenue growth of 16% to 18%, down from its prior view of $0.82 to $0.86 and 18% to 20%. "Looking out to the second half of the year, we have a strong pipeline of store openings in favorable markets," said CEO Jerome Griffith. "We continue to make strides in capitalizing on Tumi's global status as an iconic premium lifestyle brand, and we remain focused on, and confident in, our long-term growth opportunities in 2013 and beyond." Given its extra-volatile stock and shaky competitive position, however, Tumi might just have too much baggage to bet on those prospects.

The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.



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: 2586539, ~/Articles/ArticleHandler.aspx, 8/27/2014 11:43:37 AM

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...

Today's Market

updated Moments ago Sponsored by:
DOW 17,123.78 17.08 0.10%
S&P 500 1,999.71 -0.31 -0.02%
NASD 4,570.42 -0.22 0.00%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes


Advertisement