For Immediate Release
Chicago, IL – August 16, 2017 – Zacks Equity Research highlights NVIDIA Corporation (NASDAQ: (NASDAQ:NVDA) – Free Report) as the Bull of the Day Mattel (NASDAQ: (NASDAQ:MAT) – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Urban Outfitters Inc. (NASDAQ: (NASDAQ:URBN) – Free Report).
Here is a synopsis of all three stocks:
Founded in 1993 and headquartered in Santa Clara, CA, NVIDIA Corporation (NASDAQ:NVDA – Free Report) is a worldwide leader in visual computing technologies and the inventor of the graphic processing unit (GPU).
The company has successfully transformed from graphics chip to a GPU computing company and benefits from four multi-billion dollar GPU computing growth drivers —gaming, virtual reality (VR), artificial intelligence (AI), and self-driving cars.
Excellent Second Quarter Results, Upgraded Guidance
The company reported excellent results, beating on both top and bottom lines and also raising guidance. Record revenues of $2.23 billion were up 56% from a year ago and also ahead of the management’s guidance.
GAAP earnings for the quarter were $0.92 per share up 124% from $0.41 a year ago and up 16% from $0.79 in the previous quarter.
"Adoption of NVIDIA GPU computing is accelerating, driving growth across our businesses," said the CEO. "Datacenter revenue increased more than two and a half times. A growing number of car and robot-taxi companies are choosing our DRIVE PX self-driving computing platform. And in Gaming, increasingly the world's most popular form of entertainment, we power the fastest growing platforms - GeForce and Nintendo Switch.
"Nearly every industry and company is awakening to the power of AI. This is the era of AI, and the NVIDIA GPU has become its brain. We have incredible opportunities ahead of us," he said.
Despite impressive beat and raise, shares fell nearly 7% in but more than recovered all those losses on Monday as many analysts issues bullish notes on the company.
Estimates Soaring
After impressive results and upgraded guidance, Zacks Consensus Estimates for the current and next year have surged to $3.56 per share and $3.88 per share from $3.08 and $3.47 respectively.
The company has an excellent record of beating estimates, having missed only once in the past 20 quarters
Bear:
Headquartered in El Segundo, CA Mattel (NASDAQ:MAT – Free Report) is one of the world’s largest manufacturers of toys. Their portfolio includes Barbie, Hot Wheels, Monster High, American Girl, Thomas & Friends and Fisher-Price brands. They employ approximately 30,000 people in 40 countries and sell products in more than 150 countries.
Weak Results Lead to Falling Estimates
Mattel’s adjusted loss of 14 cents per share was worse than the Zacks Consensus Estimate of a loss of 8 cents. Also, revenues of $974.5 million while up 2% year over year missed our estimate.
While worldwide gross sales were up 1%, North American gross sales declined 2%. Worldwide sales for Mattel Girls & Boys Brands were up 10%, but Fischer-Price sales were down 3%, and American Girl doll sales declined 6%.
Estimates have also plunged after the report. Zacks Consensus Estimates for the current and the next year have fallen to $0.79 per share and $1.00 per share from $0.95 and $ 1.16 respectively before the results. The company has missed in three out of last four quarters, with an average negative quarterly surprise exceeding 47%.
Shares fell after the report and are now down over 39% year-to-date.
In June, the company announced that it is slashing its quarterly dividend to $0.15 per share from $0.38 per share earlier.
The Bottom Line
Mattel has seen weak sales for the past many quarters as they struggle with kids’ rising preference for videogames and smartphone applications.
Additional content:
Urban Outfitters Surges on Big Earnings Revenue Beats
Urban Outfitters Inc. (NASDAQ: URBN – Free Report) just released its second quarter fiscal 2018 financial results, posting earnings of 44 cents per share and revenues of $873 million. Currently, URBN is a #4 (Sell) on the Zacks Rank, and is surging 13.8% to $19.15 per share in trading shortly after its earnings report was released.
Urban Outfitters:
Beat earnings estimates.The company reported earnings of 44 cents per share, soaring past the Zacks Consensus Estimate of 37 cents per share. Net income was $50 million for the quarter.
Beat revenues estimates.The company saw revenues of $873 million, topping our consensus estimate of $863.87 million but declining 2% year-over-year.
Comparable Retail segment net sales, which includes Urban’s comparable direct-to-consumer channel, decreased 4.9% during Q2. Breaking it down by division, comps increased 2.9% at Free People, but decreased 4% at Anthropologie and 7.9% at Urban Outfitters.
The company said the decline in comps was due to negative retail store sales, which was partially offset by continued sales growth in our direct-to-consumer channel.
"While we are disappointed in our second quarter performance, we have a number of initiatives underway including: speed to customer, international growth, wholesale expansion and digital investments,” said Richard A. Hayne, Chief Executive Officer. “We believe these initiatives combined with encouraging fashion apparel trends could lead to improved topline performance in future quarters,” finished Mr. Hayne.
Urban Outfitters, Inc. operates two business segments consisting of a lifestyle-oriented general merchandise retailing segment and a wholesale apparel business. The retailing segment operates through retail stores and direct response, including a catalog and two web sites. The company's wholesale business designs and markets young women's casual wear which it provides to the company's retail operations and sells to specialty retailers worldwide.
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Urban Outfitters, Inc. (URBN): Free Stock Analysis Report
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