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UPDATE: D.A. Davidson & Co. Reiterates On Nautilus Following New Product Success

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Earnings Scheduled For February 23, 2015
D.A. Davidson Expects Long-Term Success For Nautilus

In a report published Tuesday, D.A. Davidson & Co. analyst Andrew Burns reiterated a Buy rating on Nautilus (NYSE: NLS), and raised the price target from $14.00 to $15.00.

In the report, D.A. Davidson & Co. noted, “2Q yields impressive revenue and EPS upside. NLS reported revenue and EPS of $48.5 million and $0.05 from continuing operations (GAAP EPS: $0.02), compared to consensus at $42.8 million and $(0.01), and our estimates of $41.2 million and $(0.01). Total revenue grew 34% year-over-year (y/y). Retail segment revenue growth of 48% was driven by the benefit of the new MaxTrainer and ongoing TreadClimber growth; Direct-to-Consumer (DTC) grew 28% y/y driven by easy comparisons and healthy Schwinn cardio product growth. Gross margin increased 323bp to 51.0%, with both Retail (+490bp) and Direct (+410bp) improvements coming from favorable mix, product costs, and operating efficiencies. Operating expenses increased 17.6% to $22.4 million, or 46.1% of sales (vs. 52.6% in 2Q13). Inventory was up 74% y/y reflecting a planned inventory build ahead of the upcoming distribution facility opening and a supplier factory move.”

Nautilus closed on Monday at $10.42.

Latest Ratings for NLS

DateFirmActionFromTo
Nov 2014CRT CapitalMaintainsBuy
Nov 2014WunderlichMaintainsBuy
Oct 2014WunderlichInitiates Coverage onBuy

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Posted-In: Andrew Burns D.A. Davidson & Co.Analyst Color Price Target Analyst Ratings

 

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