Shares of L Brands Inc. (LB, Financial) moved higher 0.84% to $20.50 in after-hours trading on Wednesday despite missing consensus estimates on earnings for the second quarter of fiscal 2019 by 4 cents.
The company posted 14 cents per share, a 61.1% fall from the prior-year quarter due to a loss associated with the refinancing of debt through cash and the issuance of a new $500 million worth corporate loan notes with maturity in 2029. The extinguished debt was $764 million.
Revenue of $2.9 billion, which was a 2.7% decline year-over-year, fell $50 million short of expectations.
Including online sales and franchised locations, total same-store sales fell 1%.
By segment, the Columbus, Ohio-based retailer reported the following changes.
Victoria’s Secret’s comparable sales dropped 500 basis points to a 6% decrease in the second quarter of fiscal 2019 from a 1% decrease in the second quarter of fiscal 2018.
Bath & Body Works’ comparable sales fell 200 basis points to am 8% increase.
Moreover, the operating margin ratio was 6.0% of total net sales versus 7.6% a year ago.
L Brands expects to post between a 5-cent loss and 5-cent profit per share in the third quarter versus consensus estimates of 8 cents and to post earnings per share of $2.30 to $2.60 for full fiscal 2019 versus estimates of $2.45.
L Brands Inc.’s share price has fallen 21% so far this year to below the 120-, 70- and 20-day simple moving average lines. The share price at close Wednesday was $20.33 with a market capitalization of $5.62 billion. The 52-week range is $19.45 to $38.
The 14-day relative strength index of 31 indicates the stock is near oversold levels.
Wall Street issued a hold recommendation rating for shares of L Brands Inc. with an average target price of $26.77.
Shares of Nordstrom Inc. (JWN, Financial) soared 12.17% to $29.77 in after-hours trading on Wednesday after topping consensus estimates on second-quarter 2019 earnings by 11 cents as the company posted 90 cents per share. Earnings per share were 5.3% lower year over year.
Revenue came in at $3.78 billion, down 5% from the prior-year quarter and missing projections by $140 million.
The Seattle-based luxury department stores chain company recorded a 50-basis-point decrease in earnings before interest and taxes margin ratio to 5.7% of net sales due to lower sales volumes.
Full-price sales fell 6.5% in the second quarter of fiscal 2019 and off-price sales declined nearly 2%. Online sales, which accounted for 30% of total sales, rose 4% during the quarter.
Further, gross profit margin rate dropped 50 basis points to 34.5% of total sales resulting from higher occupancy expenses. Selling, general and administrative expenses jumped 26 basis points to 31.2% of net sales due to fixed expense spread over a lower sales volume.
In the first half of 2019, the company bought back 4.1 million ordinary shares of its own stock, spending $186 million. The company can still retire its own common shares, investing a maximum $707 million under current authorized share repurchase program.
Looking ahead to full fiscal 2019, Nordstrom anticipates a 2% revenue drop versus a 1.1% drop according to consensus estimates, and forecasts earnings per share ranging between $3.25 and $3.50 versus the previous range of $3.25 to $3.65 and versus $3.27 consensus.
Nordstrom Inc.’s share price has fallen 43% so far this year to below the 120-, 70- and 20-day simple moving average lines. The share price at close Wednesday was $26.54 with a market capitalization of $4.1 billion. The 52-week range is $25.01 to $67.75.
The 14-day relative strength index of 39 indicates the stock is not far from oversold levels.
Wall Street issued a hold recommendation rating for shares of Nordstrom with an average target price of $34.69.
Disclosure: I have no positions in any securities mentioned.
