Ahead of Bell: Analysts lower Zumiez estimates

A weaker-than-expected second-quarter profit outlook from Zumiez Inc. prompted two analysts to lower some of their estimates for the sports apparel and equipment retailer on Friday.

Thursday, Zumiez predicted a quarterly loss of 14 cents to 17 cents per share. Analysts surveyed by Thomson Reuters forecast a much smaller loss of 7 cents per share. Analysts' estimates generally exclude one-time items.

William Blair & Co.'s Sharon Zackfia said in a client note that one concern is Zumiez foresees increased promotions in the second-quarter, which could weaken sales results.

But the analyst remained pleased with the Everett, Wash.-based company's inventory control efforts and balance sheet.

Zackfia cut her second-quarter estimate to a loss of 11 cents per share from a loss of 5 cents per share. She slashed her full-year profit forecast to 10 cents per share from 23 cents per share, but maintained a "Market Perform" rating.

Jim Duffy of Thomas Weisel Partners LLC said Zumiez's second-quarter guidance "indicates further challenges are likely and suggests continued pressure on earnings going forward into the second half in spite of easing comparisons."

Duffy reduced his 2010 earnings per share estimate to 7 cents from 20 cents and lowered his 2011 forecast to 26 cents from 38 cents. He also trimmed Zumiez's price target to $10 from $11 and reaffirmed a "Market Weight" rating.