The Fresh Market Inc (NASDAQ:TFM) will host a conference call with investors on Thursday, March 6, 2014 at 5:00 p.m. (ET) to discuss financial results for the fourth quarter ended January 26, 2014. A press release detailing the Company's financial results will be issued prior to the call.
During the conference call, the Company may answer questions concerning its business. The Company's responses to these questions, as well as other matters discussed during the conference call, may contain or constitute information that has not been previously disclosed.
Wall Street anticipates that the grocery store will earn $0.43 per share for the quarter, which is the same as last year's profit of $0.43 per share. iStock expects TFM to miss Wall Street's consensus number. The iEstimate is $0.42, one cent less than expected.
[Related -The Fresh Market Inc (TFM): Highest-Margin Food Retailer At A Decent Multiple]
The Fresh Market operates as a specialty grocery retailer in the United States. The company offers various perishable product categories, including meat, seafood, produce, deli, bakery, floral, sushi, and prepared foods; and non-perishable product categories, such as traditional grocery and dairy products, as well as bulk, coffee and candy, beer and wine, and health and beauty products. As of November 21, 2013, it operated 149 stores in 26 states.
Generally speaking, TFM's earnings have hugged Wall Street's consensus EPS estimate. Actual results ranged from $0.03 less than expected to $0.02 more than forecasted seven of the eight quarterly checkups in The Fresh Market's short life as a publicly traded company. The lone outlier was a bullish surprise of a nickel.
[Related -Vodafone Group Plc (ADR) (VOD) Weeklys Generate Big Profits For Some Traders As Shares Soar]
Earnings-driven, earnings price-sensitivity split the eight announcements with four red and green reactions. The average gain was 11.05% with a range of 5.70% to 19.90% in the three days surrounding four profit announcements. Meanwhile, the typical loss was a little more than the average gain at -12.20%, maxing out at -17% and a minimum decline of -6.20%.
Margins are hugely important in the grocery store business and could be the determining factor to Wall Street's reaction Thursday evening.
We find that sales and cost have been steady for the first nine months of 2013 and during the third quarter. Revenue increased 13.36% last quarter versus 13.12% for the first nine months. At the same time, cost of goods sold grew by 16.67% and 12.58% for Q3 and first nine months of the year, respectively.
Top 10 Construction Material Companies To Own In Right Now
However, selling, general and administrative expenses (SG&A) increased at 16.03% in the third quarter versus 14.38% year-to-date. It may not sound like a lot, but the small difference equals $0.026 per share and enough to create a bearish EPS surprise.
We also see that interest payments are rising (more than 100%) as the company takes on more debt. During Q3, the line item was up 107% and 130% for the first nine months. The difference took another $0.03 off the bottom line.
No red flags were found on the balance sheet, inventory per store rose 11.99%, but that is in-line with sales growth. It means management is doing a decent job managing inventory, which is critical when working with perishables.
Overall: Beyond traffic, which Google Trends suggest rose 15%, it looks as if SG&A could be the deciding factor for The Fresh Market Inc (NASDAQ:TFM) Thursday afternoon. If management can get the line item to reflect revenue growth (expected to be 16.1% year-over-year), then a small bullish surprise is possible.
No comments:
Post a Comment