Vera Bradley (VRA) reports first-quarter loss, misses revenue estimates

Vera Bradley (VRA) came out with quarterly loss of $0.21 per share versus the Zacks Consensus Estimate of $0.11. For comparison, a year ago the loss was $0.09 per share. These numbers have been adjusted for one-off items.

This quarterly report represents an earnings surprise of -290.91%. A quarter ago, it was expected that this handbag and accessories company would post earnings of $0.15 per share when it actually produced earnings of $0.11, delivering a surprise of -26.67%.

The company has topped consensus EPS estimates twice over the last four quarters.

Vera Bradley, which belongs to the Zacks Retail – Apparel & Footwear industry, posted revenues of $80.6 million for the quarter ended April 2024, missing the Zacks Consensus Estimate by 14.94%. For comparison, revenues from a year ago amounted to $94.36 million. The company has failed to beat consensus revenue estimates over the last four quarters.

The sustainability of the immediate share price movement based on the recently-released numbers and future earnings expectations will largely depend on management’s commentary on the earnings call.

Shares of Vera Bradley are up about 0.7% year to date, compared with the S&P 500’s gain of 12.7%.

What’s next for Vera Bradley?

While Vera Bradley has underperformed the market this year, the question that comes to investors’ minds is: what’s next for the stock?

There are no simple answers to this key question, but one reliable measure that can help investors address this issue is the company’s earnings prospects. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of the earnings release, Vera Bradley’s estimate revision trend is mixed. While the magnitude and direction of estimate revisions may change following the company’s just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) stock. Therefore, the company’s stock is expected to perform in line with the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the next quarters and the current fiscal year change in the coming days. The current consensus EPS estimate is $0.15 on $129.21 million in revenues for the coming quarter and $0.63 on $477.09 million in revenues for the current fiscal year.

Investors should be aware that the outlook for the industry may also have a significant impact on share prices. In terms of the Zacks Industry Rank, Retail – Apparel & Footwear is currently in the top 32% of over 250 Zacks industries. Our research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Another company in the same industry, Levi Strauss (LEVI), has not yet reported results for the quarter ending May 2024.

The denim maker is expected to post quarterly earnings per share of $0.11 per share in its upcoming report, representing a year-over-year change of +175%. The consensus EPS estimate for the quarter has not changed over the last 30 days.

Levi Strauss revenue is expected to be $1.45 billion, up 8.4% from the same quarter last year.

Want the latest recommendations from Zacks Investment Research? Today you can download the top 7 stocks for the next 30 days. Click to get this free report

Vera Bradley, Inc. (VRA): Free Stock Analysis Report

Levi Strauss & Co. (LEVI): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research