Designer Brands (DBI) Provides Q1 Results, Investors “Fashion” A Sell Off on News, Down ~20%
Today the global designer, manufacturer and retailer of footwear and accessories Designer Brands, Inc. (DBI), provided their Q1 financial results that missed on EPS ($0.08 vs StreetAccount $0.13) but beat on revenues ($746.6M vs FactSet $737.3M). FY guidance was reaffirmed on EPS and net sales growth which is low single digits% y/y.
The announcement was not received as well by the Street as company shares are trading down, ~20% on the news and lags the PRISM Consumer Products Index. The disappointment on estimates related to Designer Brands’ same-store sales miss in addition to their Q1 EPS and FY EPS guidance, likely have contributed to the sell off.
On their earnings call, the company did mention that Q1 ended stronger than it started and is continuing that trend into May, in part led by, a 15% increase in its athletic category. The Rubino acquisition also generated C$47M of sales in 2023, as they expect similar operating income from Rubino, as the company’s entire Canadian segment.
Time will tell how the company moves forward but seemed overall positive on its future trajectory, despite not having much of an upbeat surprise to move shares up, leaving the Street with not much confidence to “hang their hat on.” The company’s YTD return is down 4.6% which could have the potential to be a turnaround story, depending on how Designer Brands styles a comeback.
