Michael Kors Holdings: This Is One Hot IPO
On Tuesday, shares of Michael Kors Holdings (NYSE: KORS) have soared more than 22% after the company's first ever publicly released quarterly earnings results. While higher profile IPOs such as Zynga (NASDAQ: ZNGA) and Groupon (NASDAQ: GRPN) have received more attention from the financial media, KORS, which came public in December, has been the name to own.
After today's big jump in the stock price, KORS is now up better than 70% since it started trading on December 19, 2011 and the company currently has a market cap of $7.84 billion. Despite the company only recently debuting on the New York Stock Exchange, the Michael Kors brand is over 30 years old and is an established high end fashion house with a track record of growth.
As part of its IPO process, KORS released its fiscal 2011 earnings results back in December. Total revenues at the company were up 58% to $803 million with global comparable-store sales rising an unreal 48% versus fiscal 2010. In fact, KORS said that it has recorded positive comparable-store sales growth in every quarter for the past five years. Net income for the period jumped 85% to $73 million.
KORS also showed that it was continuing to execute on its store growth plans, with 30 new stores opening in fiscal 2010 and another 40 stores in fiscal 2011. The company plans to eventually operate 400 stores in North America versus the 203 it had as of October 1, 2011.
Going into the company's fiscal Q3 report on Monday morning prior to the opening bell, expectations were high - and KORS did not disappoint. The company reported net profit for ordinary shareholders rose to $32 million or $0.20, versus $21.8 million or $0.16 per share, in the year ago period.
Net income was $39 million compared to $27.8 million in last year's corresponding quarter while adjusted earnings came in at $53.6 million or $0.28 per share, versus $27.8 million or $0.16 per share, in the year ago quarter. These results compared to Wall Street consensus EPS estimates of $0.09 - a blowout for KORS.
Revenues for the period were $354 million, a big jump from the $208.8 million that KORS reported in last year's third quarter. This also beat Street consensus revenue estimates of $349.2 million.
Looking ahead, KORS sees fiscal Q4 earnings of between $0.10 an $0.20 on revenues in a range of $350 million to $355 million. This guidance compares to current Street estimates of $0.11 on revenues of $347.35 million.
For fiscal 2012, KORS expects adjusted earnings per share between $0.74 and $0.76 with total revenues between $1.27 billion and $1.28 billion.
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