Lumber Liquidators Unveils Bearish Picture Post Q3 Results - Analyst Blog

Lumber Liquidators Holdings, Inc. (LL) has been witnessing a downtrend in the Zacks Consensus Estimate after this specialty retailer of hardwood flooring disappointed with its third-quarter 2014 results. Soft consumer traffic, owing to lower demand for big ticket projects, was the reason behind the dismal performance.

Analysts polled by Zacks are now less constructive on the stock. This is evident from the movement witnessed in the Zacks Consensus Estimate that tumbled 8.6% to $2.43 for 2014 and 7.2% to $2.95 per share for 2015 in the past 60 days.

Lumber Liquidators disappointed on the earnings front, posting a negative earnings surprise of 13.4%, the second time in financial year 2014. Earlier in the first quarter, the company had witnessed a negative earnings surprise of 22.2%. The company delivered third-quarter earnings of 58 cents a share that missed the Zacks Consensus Estimate of 67 cents and also plunged 20.5% year over year.

This Toano, VA-based company's top line of $266.1 million also fell short of the Zacks Consensus Estimate of $273 million, though it managed to attain year-over-year growth of 4.6%. However, comparable-store sales declined 4.9%, along with a 2.6% reduction in the number of customers invoiced and a 2.3% fall in average sales.

Following the dismal performance, this Zacks Rank #4 (Sell) stock lowered its outlook for the year. For 2014, sales are expected to be in the range of $1.05–$1.065 billion, compared to the previous range of $1.05 billion to $1.10 billion. The company now envisions earnings per share for the year in the range of $2.38 to $2.52, against $2.65 to $3.00 projected earlier.

Stocks Worth Considering

Better-ranked retail stocks that look promising and are expected to continue with their upbeat performance include Columbia Sportswear Company (COLM) sporting a Zacks Rank #1 (Strong Buy), Hanesbrands Inc. (HBI) and Michael Kors Holdings Limited (KORS) both carrying a Zacks Rank #2 (Buy).