In skater jargon, "going fakie" means traveling in reverse, and that appears to be what Zumiez
The retailer for skateboarding and snowboarding gear reported that October same-store sales increased 5.1%, versus a 15.9% increase this time last year. Total sales increased 24.6% to $24.7 million.
Zumiez expects to profit far less for the year than Wall Street had expected. It said it's reducing its fiscal 2007 guidance to $0.92 to $0.94 per share, due to its reliance on seasonal merchandise in the fourth quarter. (That sounds like an odd and vague way to describe the fourth quarter; of course it relies on "seasonal" merchandise.)
What a far cry from last month, when Zumiez's results bucked the retail trends so soundly that it made one think skaters and other board sports enthusiasts just don't give a hoot about macroeconomic trends (which is still arguable among that youthful demographic). And Zumiez supplier Volcom
Rivals' news today was mixed. Pacific Sunwear
A quick glance at Zumiez's stock price today -- last I checked it was down 30% -- might give investors with a hankering for this traditionally high-growth stock reason to consider it now. (And Zumiez has a history of getting shredded whenever its results are even the least bit disappointing -- part of why I didn't feel particularly compelled by it despite last month's success.)
Bear in mind that the new guidance means Zumiez will grow earnings by only 27% in 2007 -- significantly lower than the 38.5% analysts previously expected. Although caution's definitely in order, Zumiez stock is beginning to look more reasonably priced than just a month ago -- as long as you still believe it will continue to generate high growth for the long term.