DSW (DSW) will report fourth quarter results tomorrow morning. DSW has ~500 shoe stores in the US.
In November, DSW missed sales estimates for the third quarter in a row. Earnings were slightly better than expected, up 16% to $0.51/share. However, comparable store sales fell 2%. DSW also raised fiscal 2017 adjusted earnings per share guidance to $1.35-1.45 from $1.32-1.42. DSW earned $1.54/share in the prior year and is expected to earn $1.53 in fiscal 2018 (ending January).
Comparable store sales are expected to fall 5.5% in the fourth quarter after growing 0.7% in last year's fourth quarter.
The company pays a quarterly dividend of $0.20/share giving the stock a ~4% dividend yield. The company is also buying back its stock, which trades at ~14x adjusted earnings estimates and just 5.5x enterprise value over EBITDA -- below the average of ~7x for a group of ~50 specialty retailers.
The stock is testing support near the $20 level ahead of this report while the retailer sector, best represented by the XRT ETF, tests support near the 42 level. It was another disappointing holiday season for retailers in general as traffic continues to decline in the face of online competition.