Let’s dig into the relative performance of Figs (NYSE:FIGS) and its peers as we unravel the now-completed Q2 apparel, accessories and luxury goods earnings season.
Within apparel and accessories, not only do styles change more frequently today than decades past as fads travel through social media and the internet but consumers are also shifting the way they buy their goods, favoring omnichannel and e-commerce experiences. Some apparel, accessories, and luxury goods companies have made concerted efforts to adapt while those who are slower to move may fall behind.
The 17 apparel, accessories and luxury goods stocks we track reported a slower Q2. As a group, revenues missed analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was 12.6% below.
After much suspense, the Federal Reserve cut its policy rate by 50bps (half a percent) in September 2024. This marks the central bank’s first easing of monetary policy since 2020 and the end of its most pointed inflation-busting campaign since the 1980s. Inflation had begun to run hot in 2021 post-COVID due to a confluence of factors such as supply chain disruptions, labor shortages, and stimulus spending. While CPI (inflation) readings have been supportive lately, employment measures have prompted some concern. Going forward, the markets will debate whether this rate cut (and more potential ones in 2024 and 2025) is perfect timing to support the economy or a bit too late for a macro that has already cooled too much.
In light of this news, apparel, accessories and luxury goods stocks have held steady with share prices up 2.5% on average since the latest earnings results.
Best Q2: Figs (NYSE:FIGS)
Rising to fame via TikTok and founded in 2013 by Heather Hasson and Trina Spear, Figs (NYSE:FIGS) is a healthcare apparel company known for its stylish approach to medical attire and uniforms.Figs reported revenues of $144.2 million, up 4.4% year on year. This print exceeded analysts’ expectations by 1.4%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ earnings estimates.
“Our strong second quarter performance shows that our investments are paying off,” said Trina Spear, Chief Executive Officer and Co-Founder.
Interestingly, the stock is up 8.2% since reporting and currently trades at $6.18.
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Kontoor Brands (NYSE:KTB)
Founded in 2019 after separating from VF Corporation (NYSE:VFC), Kontoor Brands (NYSE:KTB) is a clothing company known for its high-quality denim products.Kontoor Brands reported revenues of $606.9 million, down 1.5% year on year, outperforming analysts’ expectations by 2.3%. The business had a strong quarter with an impressive beat of analysts’ constant currency revenue estimates.
Kontoor Brands pulled off the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 10.6% since reporting. It currently trades at $77.67.
Weakest Q2: Guess (NYSE:GES)
Flexing the iconic upside-down triangle logo with a question mark, Guess (NYSE:GES) is a global fashion brand known for its trendy clothing, accessories, and denim wear.Guess reported revenues of $732.6 million, up 10.2% year on year, in line with analysts’ expectations. It was a softer quarter as it posted underwhelming earnings guidance for the next quarter.
As expected, the stock is down 8% since the results and currently trades at $18.58.
VF Corp (NYSE:VFC)
Owner of The North Face, Vans, and Supreme, VF Corp (NYSE:VFC) is a clothing conglomerate specializing in branded lifestyle apparel, footwear, and accessories.VF Corp reported revenues of $1.77 billion, down 10.1% year on year. This number missed analysts’ expectations by 4.1%. More broadly, it was a mixed quarter as it also logged an impressive beat of analysts’ constant currency revenue estimates but a miss of analysts’ EBITDA estimates.
The stock is up 8.9% since reporting and currently trades at $17.89.
PVH (NYSE:PVH)
Founded in 1881 by a husband and wife duo, PVH (NYSE:PVH) is a global fashion conglomerate with iconic brands like Calvin Klein and Tommy Hilfiger.PVH reported revenues of $2.07 billion, down 6% year on year. This print was in line with analysts’ expectations. Zooming out, it was a mixed quarter as it also logged an impressive beat of analysts’ earnings estimates.
The stock is down 7.8% since reporting and currently trades at $96.32.
This content was originally published on Stock Story
