Michael Kors Continues Rally After Strong Earnings Beat

Shares of Michael Kors

spiked on Tuesday -- up as much as 16 percent -- after it reported earnings and raised its annual forecast. Overall, the share price is up more than 55% this year. John Idol, the Company's Chairman and CEO said, "We are pleased with the strong start to our fiscal year with a 71% increase in total revenue and 185% growth in net income." Idol went on to say that resonance of the brand with their target audience greatly aided in the company's growth. The company said earnings per share might be as high as $1.34, quite above expectations of $1.12. The company's revenue increased primarily from its sales, which surged 71 percent to $414.9 million, with retail sales rising 76 percent to $215 million in the first-quarter. Idol attributed the great gains to continued execution of growth strategies and the overall success of the Michael Kors brand. The expansion from the luxury designer into a full blown lifestyle brand was also cited as a cause for the spike in profit expectations. The expansion of Michael Kors retail stores also aided the company's earnings. In the last year the lifestyle brand opened 76 new stores, while stores that had been open for more than a year improved 37.3 percent the first quarter. The company now operates a total of 321 stores worldwide, including those operated with licensee partners. Analysts at Wedbush believe that fashion watches and handbags, which have been highly successful, will continue to aid growth. Michael Kors has set second-quarter expectations for total revenue to be in the range of $490 million to $500 million, while targeting earnings per share of 33 cents to 35 cents per share. Shares of Michael Kors traded near $49.