The Container Store Group, Inc. (TCS) stock | Containing An Earnings Miss

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The Container Store Group, Inc. (NYSE: TCS)

 

Shares of the nation’s leading retailer of storage and organization products store, The Container Store, sharply declined more than 12% after the company report second quarter earnings that were weaker than expected after the close Monday.  After closing Monday up 2.84% to $15.57, TCS shares are currently sitting at $13.55 in afterhours, well below its 2013 IPO price of $45 a share.

 

The Container Store Earnings & Outlook

TCS reported a second quarter profit of $2.7 million, or 6 cents a share vs. $6.96 million or 14 cents a share a year ago.   Analysts had expected the company to earn 7 cents a share.  Net sales for the second quarter rose to $195.5 from $193.2 year over year. Consensus revenue estimates from analysts was $197.7 million for the quarter.  Comparable store sales increased 0.1% year over year.  Looking forward the company continues to expect earnings of $0.30 to $0.38 per share and net sales to be $800 million to $815 million. This is in line with analyst’s estimates of $0.34 per share on revenues of $201.71 million for the year.  The company also narrowed its previously stated same store sales from 2%- flat to -1% to flat.

 

 The Container Store’s CEO Comments

In response to the increase seen in comparable store sales, The Container Store CEO Kip Tindell said,

 “Our intense and ongoing focus on solutions-based selling and the number of units sold in each transaction also continues to become more and more impactful and is another driver of our second quarter sales increase.” TheStreet

TCS Technical Analysis

TCS

Shortly after its IPO in November 2013, TCS reached a high of $47.07 and has since been in a decline reaching lows of $12.58 a few days ago.  While the stock has bounced off those lows with a close on Monday of $15.57, the recent earnings miss has brought the share price back near all time lows.  Seven brokerage firm analysts currently have a price target of $20.14 with the highest estimate at $25.00 and the lower estimate at $16.00.  Yahoo! finance

 

The Container Store Group, Inc. Company Profile

The Container Store Group, Inc. engages in the retailing of storage and organization products in the United States. It operates in two segments, TCS and Elfa. The company’s retail stores provide various lifestyle products, including bath, box, closets, collections, containers, food storage, gift packaging, hooks, kitchen, laundry, office, shelving, storage, trash, and travel, as well as elfa branded products. It also designs, manufactures, and sells component-based shelving and drawer systems that are customizable for any area of the home, such as closets, kitchens, offices, and garages, as well as made-to-measure sliding doors. As of July 7, 2015, the company operated 72 store locations with an average of 25,000 square feet each. It also offers its products directly to customers through its Website and call center, as well as sells to various retailers and distributors, and on a wholesale basis. The company was founded in 1978 and is headquartered in Coppell, Texas.  Yahoo! Finance

 

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