The global fashion industry is finding its feet after nearly two years of supply chain disruption and erratic demand. McKinsey fashion scenarios suggest global fashion sales will reach 103-108% of 2019 levels in 2022. Due to pent-up demand, sales appear to be on track to gain momentum this year.
Given the dynamism of the apparel industry, the integration of technological innovations such as Artificial Intelligence (AI), Augmented Reality (AR), Virtual Reality (VR) and data analytics is increasing, driving the growth of the industry. Additionally, with sustainability dominating the fashion agenda lately, companies are aggressively expanding their sustainable assortments and enhancing supply chains.
In this context, the fashion titles Hugo Boss AG (AUTHORITARIAN), Chico’s FAS, Inc. (CHS), Nordstrom, Inc. (JWN), Macy’s, Inc. (M.) and Dillard’s, Inc. (DDS), who currently trade at discounts relative to their competitors, could be solid additions to your portfolio.
Hugo Boss AG (AUTHORITARIAN)
Headquartered in Metzingen, Germany, BOSSY develops, markets and distributes clothes, shoes and accessories for men and women around the world.
BOSSY sales increased 55.3% year-over-year to 772 million euros ($ 813.44 million) in the fiscal quarter ended March 2022. gross profit it grew by 58.7% compared to a year ago to 476 million euros (501.55 million dollars). Net income increased 425% year-over-year to 26 million euros ($ 27.40 million). In addition, its EPS stood at € 0.35, up 369.2% compared to the previous year’s quarter.
Analysts expect BOSSY’s revenue for the fiscal quarter ended June 2022 will come in at $ 787.59 million, indicating a 5.8% year-over-year increase. Additionally, the company’s revenue is expected to grow 10.4% year-over-year to $ 3.38 billion in the current fiscal year. It surpassed consensus estimates on EPS in three of the final four quarters.
In terms of EV / EBITDA forward, BOSSY is currently trading at 6.20x, 22.6% lower than the industry average of 8.01x. Its 12-month price / cash flow multiple of 4.59 is 55.6% lower than the industry average of 10.33.
BOSSY gained 3% intraday to close yesterday’s trading session at $ 10.66.
BOSSY’s solid fundamentals are reflected in his POWR ratings. The stock has an overall rating of A, which translates to Strong Buy in our POWR rating system. The POWR Ratings are calculated considering 118 different factors, each of which is optimally weighted.
BOSSY also has an A rating in Growth and Quality and a B in Value. It is classified n. 2 of 68 titles in category B Fashion and luxury industry.
In addition to the above, we also rated BOSSY for Momentum, Sentiment and Stability. Get all BOSSY ratings here.
Chico’s FAS, Inc. (CHS)
CHS operates as an omnichannel specialist retailer of private label casual-elegant women’s clothing, underwear and complementary accessories.
In March 2022, CHS announced the advancement of digital-first capabilities with new mobile shopping apps across the company’s brands to unify customers’ omnichannel shopping. These advanced digital capabilities should help expand its reach to the market.
For the fiscal quarter ended April 30, 2022, CHS total net sales increased 39.4% yoy to $ 540.92 million. Its operating income grew 703.5% from a year ago to $ 45.41 million. Net income for the quarter was $ 34.93 million, reflecting a 491.2% year-over-year increase. Additionally, its net earnings per share were $ 0.28, up 450% from the prior-year quarter.
Street expects CHS’s revenue for the quarter ended July 2022 to stand at $ 543.90 million, indicating a 15.2% year-over-year increase. Its EPS is expected to improve 19.1% yoy to $ 0.25. CHS also beaten consensus estimates on EPS in each of the final four quarters.
In terms of forward EV / EBITDA, CHS is currently trading at 6.51x, 18.7% lower than the industry average of 8.01x. Its forward price / sales multiple of 0.33 is 61.4% lower than the industry average of 0.86.
Shares of CHS gained 21.3% over the past month to close the last trading session at $ 5.24.
The solid foundations of CHS are reflected in its POWR ratings. The stock has an overall rating of B, which equates to Buy in our POWR rating system.
The company has an A grade in Quality and a B in Value and Growth. The title is in 4th place in the Fashion & Luxury ranking industry. To obtain CHS ratings for Momentum and Sentiment, Click here.
Nordstrom, Inc. (JWN)
JWN, a fashion retailer, supplies clothing, shoes, beauty products, accessories and homewares for women, men, young adults and children.
On April 26, JWN announced plans to open a new Nordstrom Rack in the spring of 2023 to be located at NOHO West, a mixed-use complex in the North Hollywood neighborhood of Los Angeles, CA. JWN expects the new location to help the company strengthen its network and better serve customers by offering them the brands they love at the best prices.
JWN’s net sales increased 18.7% yoy to $ 3.47 billion in the fiscal quarter ended April 30, 2022. Its net profit grew 112% from a year ago to $ 20 million. dollars, while its EPS improved 112.4% year-over-year to $ 0.13.
JWN’s revenue for the fiscal quarter ended July 2022 is expected to increase 8.9% yoy to $ 3.98 billion. The EPS consensus estimate of $ 0.81 for the same quarter indicates a 65.9% year-over-year increase.
In terms of forward sales / EVs, JWN is trading at 0.51x, 49.8% lower than the industry average of 1.02x. Its forward price / sales multiple of 0.24 is 71.5% lower than the industry average of 0.86.
Shares of JWN gained 3.2% year to date to close the last trading session at $ 23.34. It.
The company has an overall rating of B, which translates to Buy in our proprietary rating system. JWN is rated A in Value and B in Quality and Growth. Within the same industry, is ranked # 13.
Click here to see further POWR ratings for stability, momentum and sentiment for JWN.
Macy’s, Inc. (M.)
M, an omnichannel retail organization, operates stores, websites, and mobile applications. The company sells a wide range of products, such as clothing and accessories for men, women and children; cosmetics; furniture; and other consumer goods.
On March 31, M announced its plans to open a new 1.4 million square foot automated direct-to-consumer logistics center in North Carolina in 2024 to meet the growing needs of its omnichannel business. “This state-of-the-art facility is a significant milestone for Macy’s, Inc. as we invest in strengthening our omnichannel ecosystem. It will support the growth of our business as a major omnichannel retailer, ”said Dennis Mullahy, Chief Supply Chain Officer of Macy’s, Inc ..
Net sales of M increased 13.6% yoy to $ 5.35 billion in fiscal first quarter of 2022. Its net income improved 177.7% yoy to $ 286 million over the period , while Adjusted EBITDA and Adjusted EPS increased 44.6% and 176.9% from a year ago to $ 684 million and $ 1.08, respectively.
Analysts expect M’s revenue for the fiscal year ending January 2023 to stand at $ 24.58 billion, indicating a marginal year-over-year increase. M also beaten consensus EPS estimates in all final four quarters, which is impressive.
In terms of forward P / E, M is currently trading at 4.47x, 62.2% lower than the industry average of 11.82x. Its forward EV / Sales multiple of 0.44 is 57.4% lower than the industry average of 1.02.
The stock gained 4.8% over the past year to close the last trading session at $ 23.34.
Unsurprisingly, M has an overall rating of B, which equates to Buy in our POWR rating system. The title has an A grade in Value and Quality. In the fashion and luxury sector, M ranks 14th.
In addition to the POWR rating grades I just highlighted, you can see M ratings for Momentum, Growth, Sentiment, and Stability here.
Dillard’s, Inc. (DDS)
DDS operates large retail stores in the United States. Its stores offer merchandise, including fashionable clothing for women, men and children, accessories, cosmetics, home furnishings and other consumer goods.
Net sales of DDS increased 21.3% yoy to $ 1.61 billion in the fiscal quarter ended April 30, 2022. Its net profit grew 58.7% from a year ago to 251. , $ 10 million, while its EPS increased 88.7% year-over-year to $ 13.68. Additionally, its net cash provided by operating activities was $ 365.20 million, up 20.8% from the prior-year quarter.
DDS revenue is expected to grow 0.14% yoy to $ 6.63 billion in the fiscal year ending January 2023. It also beat consensus EPS estimates in each of the final four quarters.
In terms of forward price / sales, DDS is currently trading at 0.73x, 14.7% lower than the industry average of 0.86x. Its forward P / E multiple of 10.11 is 14.5% lower than the industry average of 11.82.
The stock gained 60.2% over the past year to close the last trading session at $ 258.95.
DDS’s POWR ratings reflect this promising outlook. The company has an overall rating of B, which translates to Buy in our proprietary rating system. DDS is rated A in Value and Quality. The title is ranked # 17 in the Fashion and luxury industry.
Click here to see additional POWR ratings for Momentum, Growth, Stability and Sentiment for DDS.
BOSSY stock traded at $ 10.66 per share on Thursday morning, up $ 0.31 (+ 3.00%). Since the beginning of the year, BOSSY has fallen by -10.07%, compared to a -20.23% increase in the benchmark S&P 500 index over the same period.
About the author: Komal Bhattar
Komal’s passion for the stock market and financial analysis led her to pursue investment research as a career. Its fundamental approach to stock analysis helps investors identify the best investment opportunities. Moreover…