Carter's Inc. (CRI, Financial) has announced its financial results for the first quarter, reporting revenue of $629.8 million. This figure surpasses the market predictions, which estimated the company's revenue at $623.41 million. The positive performance reflects the company's continued strength in the market despite ongoing challenges.
In a significant leadership update, Douglas C. Palladini has taken the helm as the new CEO and President of Carter's. Palladini expressed his gratitude towards the company's Board of Directors for entrusting him with the responsibility to steer Carter's towards sustainable and profitable growth. He also emphasized the company's robust market position, enduring brand appeal, and extensive distribution network as critical factors for future success.
As a prominent American brand, Carter's holds a long-standing relationship with generations of consumers. Palladini noted the unique connection that the brand has established with families over the years and expressed enthusiasm for building on this legacy to drive long-term growth. With a dedicated and talented team, Carter's is well-positioned to capitalize on its brand strength and continue its expansion in the market.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 4 analysts, the average target price for Carter's Inc (CRI, Financial) is $39.75 with a high estimate of $48.00 and a low estimate of $33.00. The average target implies an upside of 3.98% from the current price of $38.23. More detailed estimate data can be found on the Carter's Inc (CRI) Forecast page.
Based on the consensus recommendation from 6 brokerage firms, Carter's Inc's (CRI, Financial) average brokerage recommendation is currently 3.2, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Carter's Inc (CRI, Financial) in one year is $68.64, suggesting a upside of 79.54% from the current price of $38.23. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Carter's Inc (CRI) Summary page.
CRI Key Business Developments
Release Date: February 25, 2025
- Consolidated Net Sales: $860 million, slightly up over last year.
- Adjusted Operating Income: $115 million, representing a 13.4% adjusted operating margin.
- Adjusted EPS: $2.39, down 13% from last year.
- Gross Margin: 47.8%, down 90 basis points from last year.
- US Wholesale Sales Growth: 7% year-over-year.
- International Retail Comps: Canada up 6%, Mexico up 8%.
- Full Year Net Sales: $2.8 billion, down 3% from last year.
- Full Year Operating Income: $287 million, down 13% from last year.
- Full Year EPS: $5.81, down 6% versus last year.
- Year-End Inventories: Down 6% versus last year.
- Operating Cash Flow: Nearly $300 million generated.
- 2025 Sales Outlook: $2.780 billion to $2.855 billion.
- 2025 Operating Income Outlook: $180 million to $210 million.
- 2025 Adjusted EPS Outlook: $3.20 to $3.80.
- 2025 Operating Cash Flow Outlook: Around $200 million.
- 2025 CapEx Forecast: $65 million, up about $10 million over last year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Carter's Inc (CRI, Financial) exceeded its sales and earnings expectations for the fourth quarter of 2024.
- The company saw a rise in consumer confidence and favorable holiday selling, contributing to a positive end to the year.
- Carter's Inc (CRI) grew its market share in the baby and toddler apparel segments in the US in 2024.
- The company's exclusive brand products achieved record sales in 2024, leveraging consumer shifts to mass channels.
- Carter's Inc (CRI) introduced new personalization capabilities and rebranded its loyalty program, enhancing customer engagement.
Negative Points
- Carter's Inc (CRI) anticipates a challenging profitability outlook for 2025.
- The company recorded a $30 million noncash pretax charge related to the impairment of the OshKosh B'gosh brand trade name.
- Fourth quarter adjusted EPS was down 13% from the previous year.
- US Retail segment faced a decline in sales, impacting overall performance.
- The stronger US dollar negatively affected international segment results and is expected to be a headwind in 2025.
