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DECK vs. UAA: Which Footwear Brand is the Smarter Investment Now?
ZACKS· 2025-06-26 15:26
Core Insights - Deckers Outdoor Corporation (DECK) is experiencing significant growth driven by its brands HOKA and UGG, while Under Armour, Inc. (UAA) is transforming into a premium athletic brand [1] - The competitive landscape raises questions about which stock offers better upside potential for investors [1] Deckers Outdoor Corporation (DECK) - Deckers is focusing on high-margin markets, with fiscal 2025 net sales reaching $4.98 billion, a 16.3% year-over-year increase [2] - Projected first-quarter revenues for fiscal 2026 are between $890 million and $910 million, with HOKA expected to grow in low-double digits and UGG in mid-single digits [2] - Product innovation is key, with strong demand for updated HOKA models and new UGG hybrid products [3] - The company is expanding its omni-channel presence, balancing growth between wholesale and direct-to-consumer (DTC) channels, with international markets outperforming [4] - Despite record results in fiscal 2025, DECK faces challenges from new tariffs potentially adding costs of up to $150 million in fiscal 2026 [5] - Gross margin is expected to decline from 57.9% in fiscal 2025, with a projected contraction of 210 basis points for fiscal 2026 [6] - SG&A costs are anticipated to grow faster than revenues, leading to a decline in earnings per share to 62-67 cents from 75 cents in the prior year [8] - DECK's stock has dropped 13.6% over the past three months due to margin pressures and cautious guidance [20] Under Armour, Inc. (UAA) - Under Armour is enhancing its DTC channel by focusing on premium pricing, resulting in double-digit growth in average unit retail in fiscal 2025 [10] - The brand's loyalty program, with 28 million members, significantly contributes to U.S. DTC revenues [11] - EMEA region is a strong performer, with plans for expansion into France, Spain, and Germany in fiscal 2026 [12] - UAA recorded a 170-basis-point increase in gross margin in fiscal 2025, with expectations for further margin gains in fiscal 2026 [13][14] - The company is targeting $75 million in annualized savings by the end of fiscal 2026 through cost optimization [15] - Despite expected revenue declines of 4-5% in the first quarter of fiscal 2026, UAA is focused on long-term brand elevation and operational discipline [16][17] - UAA's stock has gained 5.5% over the past three months, driven by improving margins and premiumization efforts [20] Comparative Analysis - The Zacks Consensus Estimate for DECK suggests a 7.6% growth in sales but a 4.4% decline in earnings per share for fiscal 2026 [18] - UAA's estimates indicate a 2.1% decline in sales but a 9.7% growth in earnings per share for fiscal 2026 [19] - DECK is trading at a forward P/S multiple of 2.77, while UAA's is at 0.57, indicating UAA may offer better value [22] - Under Armour is viewed as a better investment case due to its strategic shift towards premiumization and disciplined cost control [25][26]
Is Cost Optimization the Key to Under Armour's Gross Margin Strength?
ZACKS· 2025-06-17 16:15
Core Insights - Under Armour, Inc. (UAA) reported a gross margin of 46.7% for Q4 fiscal 2025, a year-over-year increase of 170 basis points, driven by lower product and freight costs, reduced discounting, and improved royalty terms [1][2][3] Financial Performance - For fiscal 2025, the gross margin was 47.9%, up 180 basis points from the previous year, attributed to reduced supply-chain costs and strategic discount reductions [3] - The company anticipates a gross margin expansion of 40-60 basis points in Q1 fiscal 2026, supported by favorable product mix and continued supply-chain efficiencies [5] Strategic Initiatives - Under Armour is focusing on "higher quality revenue" and regaining pricing power by reducing reliance on markdowns, which is central to its brand elevation strategy [4] - The ongoing restructuring program has led to $89 million in transformation charges but yielded $35 million in savings for fiscal 2025, with expectations of reaching a $75 million annualized cost-saving run-rate by the end of fiscal 2026 [7][9] Cost Management - Selling, general and administrative (SG&A) expenses are projected to decline by 40% from the prior-year quarter, reflecting disciplined spending and enhanced productivity [8][9] - The combination of restructuring-driven savings and tighter cost control positions Under Armour to support gross margin gains and improve overall profitability [9] Market Performance - UAA shares gained 0.8% in the past month, outperforming the Zacks Textile – Apparel industry's decline of 16.5% and the broader Consumer Discretionary sector's performance [10]
Should GameStop Stock Be in Your Portfolio Pre-Q1 Earnings?
ZACKS· 2025-06-02 16:35
Core Insights - GameStop Corp. is set to release its first-quarter fiscal 2025 earnings results on June 10, prompting investors to consider whether to buy or hold the stock [1] - The company is undergoing a strategic transformation towards a digital-focused business model, emphasizing e-commerce and digital gaming to adapt to changing consumer behaviors [2] Financial Performance Expectations - The Zacks Consensus Estimate for first-quarter revenues is $750 million, reflecting a 16% decrease from the previous year [3] - Earnings per share are projected at $0.08, indicating a significant year-over-year increase of 166.7% [3] - GameStop has a trailing four-quarter earnings surprise of 137.8%, with the last quarter surpassing estimates by 233.3% [4] Earnings Prediction Model - The current Zacks Rank for GameStop is 3 (Hold) with an Earnings ESP of 0.00%, indicating uncertainty regarding an earnings beat [5][6] Strategic Initiatives and Challenges - GameStop's fiscal first-quarter results are expected to reflect both the ongoing transformation and challenges in its legacy business, particularly in hardware and software sales [7][10] - The company is focusing on higher-margin categories like collectibles and has streamlined its cost structure to enhance profitability [9][10] - Continued investment in logistics and customer experience, along with exploration of digital ventures, is part of the strategic shift [8] Market Performance - GameStop's stock price has increased by 12% over the past month, outperforming the industry average rise of 4.8% [11] - The stock is trading at a premium with a forward 12-month price-to-sales (P/S) ratio of 4.10, compared to the industry average of 3.22 [12] Investment Considerations - The company's focus on cost optimization and digital strategy suggests potential for long-term growth, although its premium valuation may raise concerns [16] - Current investors may consider holding their positions, while new investors might wait for post-earnings clarity [16][17]
PROP vs. CIVI: Which DJ Basin Player Has the Upper Hand?
ZACKS· 2025-05-30 12:41
Core Viewpoint - Prairie Operating Co. (PROP) and Civitas Resources (CIVI) are two independent energy firms competing in Colorado's DJ Basin, with PROP focusing on aggressive growth through acquisitions and CIVI emphasizing cost discipline and expansion into high-return Permian assets [1][2]. Group 1: Prairie Operating Co. (PROP) - Strategic Growth via Acquisitions: PROP has executed over $800 million in acquisitions since 2023, tripling its scale and adding 54,000 net acres and over 28,000 BOE/d in output [3][4]. - Financial Firepower and Production Growth: Adjusted EBITDA for 2025 is forecasted between $350 million and $370 million, with net income guidance of $69 million to $102 million, and expected production averaging 29,000 to 31,000 BOE/d in 2025, a more than 300% increase year over year [4][5]. - Strategic Hedging Locks in Upside: PROP has hedged about 85% of its 2025 daily production at $68.27/bbl WTI, providing visibility on cash flows and protecting against market volatility, with a hedge book valued at approximately $70 million [5]. Group 2: Civitas Resources (CIVI) - Cost Optimization and Cash Flow Strength: CIVI is targeting $100 million in additional annual free cash flow through a company-wide cost optimization plan, expecting to generate $1.3 billion in free cash flow in 2024 and $1.1 billion in 2025 [6]. - Focused Permian Expansion: CIVI has shifted 40% of its capital activity to the Delaware Basin, which has shown the highest returns, with operational gains reflected in faster drilling rates and enhanced capital efficiency [7]. - Robust Balance Sheet and Hedging Strategy: CIVI aims to achieve a $4.5 billion net debt target by year-end 2025, with nearly $200 million in hedge value secured, insulating free cash flow against oil price volatility [8]. Group 3: Price Performance and Valuation - Price Performance: Both PROP and CIVI have seen significant declines over the past year, with PROP down 71% and CIVI down 61%, attributed to weak oil prices and macro concerns [10]. - Valuation Comparison: PROP trades at 0.27X forward sales, significantly lower than CIVI's 0.56X, indicating a potential undervaluation [13]. - EPS Estimates: PROP's earnings are projected to surge by 382.9% in 2025, while CIVI's EPS is expected to fall by 29.3% in the same year, highlighting PROP's stronger growth trajectory [14][16]. Group 4: Conclusion - Both PROP and CIVI carry a Zacks Rank 3 (Hold), with CIVI offering strong free cash flow and disciplined cost control, while PROP presents exciting growth potential and an improving cash flow profile, positioning PROP slightly better at this moment [19].
Cost-Optimized PolarFire® Core FPGAs and SoCs from Microchip Technology Deliver High Performance with a 30% Lower Price Tag
GlobeNewswire News Room· 2025-05-20 10:10
Core Insights - Microchip Technology is launching PolarFire® Core FPGAs and SoCs to address rising Bill of Material (BOM) costs, optimizing performance and budgets for developers [1][3] - The new PolarFire Core devices can reduce customer costs by up to 30% by eliminating integrated serial transceivers while maintaining low power consumption and high reliability [1][2] Product Features - PolarFire Core families are designed for various markets including automotive, industrial automation, medical, communication, defense, and aerospace, featuring Single Event Upset (SEU) immunity and a quad-core, 64-bit RISC-V® microprocessor [2] - The devices are pin-to-pin compatible with the full line of PolarFire FPGAs, enhancing value for cost-sensitive applications [2] Market Context - The FPGA market is facing challenges as many manufacturers have raised prices, prompting OEMs to seek cost-effective solutions [3] - Microchip's PolarFire Core devices are positioned to provide market-leading solutions at favorable price points, addressing both price and power budget challenges [3] Development Support - PolarFire Core devices are supported by Microchip's Libero® SoC Design Suite, SmartHLS™ compiler, and VectorBlox™ Accelerator SDK, facilitating rapid RISC-V application development [4] - Compatibility with existing PolarFire FPGA and SoC development boards is emphasized to expedite silicon development [4] Availability - Information regarding pricing and purchasing can be obtained through Microchip sales representatives or their official website [5]
Novume(REKR) - 2025 Q1 - Earnings Call Transcript
2025-05-14 21:32
Financial Data and Key Metrics Changes - The company reported revenue of $9.2 million for Q1 2025, representing a 6% decrease compared to the same quarter last year [17] - Adjusted EBITDA loss improved by $2 million to $7.4 million from $9.4 million in Q1 2024, attributed to significant reductions in operating expenses [17][19] - Adjusted gross margin for Q1 2025 was 48.2%, up from 46% in the same period last year, driven by a higher mix of margin-accretive offerings [18] Business Segment Data and Key Metrics Changes - Revenue was impacted across all three business segments due to adverse weather conditions, delays in contract signings, and budget constraints from public agencies [17] - Recurring revenue totaled $5.1 million for the quarter, showing a modest 3% increase from Q1 2024 [18] Market Data and Key Metrics Changes - The company faced significant headwinds in sales execution due to external factors such as weather and political uncertainties affecting public safety agencies [17] - The sales pipeline remains strong, particularly with State Departments of Transportation and public safety agencies, indicating potential for future revenue growth [21] Company Strategy and Development Direction - The company is implementing a new general manager structure to sharpen focus on customers and accelerate product adoption, aiming for sustainable revenue growth [9][10] - The focus is shifting towards exploiting the commercial potential of existing products rather than future projects, with an emphasis on operational accountability and customer-centricity [6][14] - The company plans to maintain discipline in managing costs while balancing growth investments, targeting breakeven adjusted EBITDA in the foreseeable future [22][23] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that Q1 performance was below expectations but emphasized a clear plan for growth and margin improvement [23] - The company anticipates continued improvement in adjusted EBITDA as revenue grows, supported by expanding gross margins and ongoing cost optimization efforts [20][21] - Management expressed confidence in achieving profitability before the end of the year, citing structural changes and a focus on delivering existing products [72] Other Important Information - The company is actively pursuing international markets and partnerships, leveraging the expertise of new leadership to enhance global market penetration [11][60] - The management team is focused on building shareholder value and rewarding investor trust through improved performance in the coming quarters [24] Q&A Session Summary Question: Can you provide insight on the pipeline for Scout and its bookings in Q1? - Management noted that Scout has grown significantly since its launch in 2019, and there will be increased activity in the next 30 to 60 days as the focus shifts back to commercial applications [28] Question: What are the expectations for organic sales growth this year? - Management indicated that they expect substantial growth with Discover due to modifications in pricing and go-to-market strategies, acknowledging a learning curve in dealing with government procurement [38] Question: How much of the $15 million annualized cost savings have been implemented? - Management confirmed that the cost savings will be realized throughout the year, with continued reductions expected as revenue grows [41] Question: Is there potential to monetize the data collected for Roadway Intelligence? - Management highlighted that there is significant demand for their existing product platforms and that they will focus on selling what they have rather than expanding into new data services at this time [45] Question: Are there plans for international sales? - Management confirmed that there is demand for their products internationally and that they are actively pursuing opportunities in developed nations [60] Question: Will there be updates regarding the QSR sector? - Management affirmed that the QSR sector remains a focus, with potential for valuable data services to retail businesses [70]
Novume(REKR) - 2025 Q1 - Earnings Call Transcript
2025-05-14 21:30
Financial Data and Key Metrics Changes - The company reported revenue of $9.2 million for Q1 2025, representing a 6% decrease compared to the same quarter last year [17] - Adjusted EBITDA loss improved by $2 million to $7.4 million from $9.4 million in Q1 2024, attributed to significant reductions in operating expenses [17][19] - Adjusted gross margin for Q1 2025 was 48.2%, up from 46% in the same period last year, driven by a higher mix of margin-accretive offerings [18] Business Segment Data and Key Metrics Changes - Revenue was impacted across all three business segments due to adverse weather conditions, delays in contract signings, and budget constraints from public agencies [17] - Recurring revenue totaled $5.1 million for the quarter, showing a modest 3% increase from Q1 2024 [18] Market Data and Key Metrics Changes - The company faced significant headwinds in sales execution due to external factors such as weather and political uncertainties [17] - The sales pipeline remains strong, particularly with State Departments of Transportation and public safety agencies, indicating potential for future revenue growth [21] Company Strategy and Development Direction - The company is implementing a new general manager structure to enhance customer focus and accelerate product adoption, aiming for sustainable revenue growth [8][12] - The focus is shifting towards exploiting the commercial potential of existing products rather than future projects, with an emphasis on operational accountability and innovation [6][14] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the first quarter performance was below expectations but emphasized ongoing efforts to improve execution and deliver results [22][23] - The company anticipates continued improvement in adjusted EBITDA as revenue grows, supported by expanding gross margins and ongoing cost optimization initiatives [20][21] Other Important Information - The company is targeting breakeven adjusted EBITDA in the foreseeable future and aims to exit 2025 on a significantly stronger financial footing [22] - The management team is focused on building shareholder value and rewarding investor trust through actions and results in the coming quarters [24] Q&A Session Summary Question: Can you provide insight on the pipeline for Scout and its bookings in Q1? - Management noted that Scout has grown significantly since its launch in 2019, and there will be increased activity in the next 30 to 60 days as the focus shifts back to commercial applications [28] Question: Are there any partnerships in development similar to Sound Thinking? - Management confirmed ongoing discussions for partnerships, particularly with Scout and Discover, but details could not be disclosed as they are nonpublic [30] Question: What is the expectation for organic sales growth this year? - Management indicated that the reorganization and new pricing strategies for Discover are expected to drive substantial growth, particularly as government adoption increases [36][38] Question: How much of the $15 million annualized cost savings have been implemented? - Management stated that the cost savings will be realized throughout the year, with continued reductions expected as revenue grows [40][41] Question: Is there potential to monetize the data collected for Roadway Intelligence? - Management acknowledged the potential for additional services but emphasized the current focus on selling existing products to meet demand [44][46] Question: What is the outlook for international sales and partnerships? - Management confirmed that there is demand for products internationally and that efforts are underway to penetrate these markets [63][65] Question: Will there be updates regarding the QSR sector? - Management indicated that the QSR sector remains a focus, with potential for increased data monetization opportunities [72][74] Question: Is the company on track for profitability by the end of the year? - Management expressed confidence in achieving profitability before the end of the year, emphasizing the need for operational efficiency and effective product delivery [75][76]
Aterian Reports 2025 First Quarter Financial Results
Globenewswire· 2025-05-14 20:05
Core Insights - Aterian, Inc. announced a cost optimization plan aimed at reducing annual spending by approximately $5 - $6 million, alongside updates on tariff mitigation strategies [1][7]. Financial Performance - For Q1 2025, net revenue was reported at $15.4 million, down from $20.2 million in Q1 2024, primarily due to SKU rationalization and changes in Amazon's affiliate program [5]. - Gross margin decreased to 61.4% from 65.1%, while contribution margin fell to 13.4% from 14.1% [5][34]. - Operating loss improved to $(3.7) million from $(5.3) million, and net loss narrowed to $(3.9) million from $(5.2) million [5][37]. - Total cash balance decreased to $14.3 million from $18.0 million at the end of 2024 [5]. Tariff Mitigation Initiatives - The company is focusing on reducing fixed costs, diversifying manufacturing, and strategically raising prices to mitigate tariff impacts [3][6]. - A new goal has been established to manufacture no more than 30% of goods from China by the end of 2025, an improvement from the previous target of less than 40% by the second half of 2026 [6]. Cost Optimization Plan - The cost optimization plan is expected to generate $5 - $6 million in pre-tax savings, with $5 million anticipated by the end of 2025 [7]. - The company estimates incurring approximately $2.3 million in costs associated with the implementation of this plan [7]. Guidance Commentary - Due to significant uncertainty in the economic landscape, the company has withdrawn its previously issued net revenue and Adjusted EBITDA guidance for 2025 [8].
Team(TISI) - 2025 Q1 - Earnings Call Transcript
2025-05-13 16:00
Team (TISI) Q1 2025 Earnings Call May 13, 2025 11:00 AM ET Speaker0 Good day, and welcome to the Team Incorporated First Quarter Update Conference Call. All participants will be in a listen only mode. I would now like to turn the conference over to Mr. Nelson Haight, Executive Vice President and Chief Financial Officer. Please go ahead, sir. Speaker1 Thank you, operator. Good morning, everyone, and welcome to Team Inc. Discussion about our first quarter twenty twenty five operational and financial results. ...
Caledonia Mining Plc(CMCL) - 2025 Q1 - Earnings Call Transcript
2025-05-12 14:02
Caledonia Mining Corporation (CMCL) Q1 2025 Earnings Call May 12, 2025 09:00 AM ET Company Participants Mark Learmonth - Director & CEORoss Jerrard - CFOJames Mufara - Chief Operating OfficerRusiano Tsoka - Group Safety, Health & Environment Manager - Blanket MineVictor Gapare - Executive DirectorCraig Harvey - Vice President of Technical Services Conference Call Participants None - Analyst Operator Ladies and gentlemen, welcome to the Caledonia Mining Q1 Results Presentation. I'd like to hand over to Mark ...