Proactive Investors - Aritzia Inc (TSX:TSX:ATZ) shares shot up 21% to $31.98 in early Thursday trading after the women’s fashion retailer reported a 4.6% year-over-year rise in its third quarter 2024 net revenue to $653.5 million, surpassing the $620 million analyst consensus estimate.
The company’s adjusted earnings per share (EPS) for the period, meanwhile, fell to $0.47 from $0.67 a year earlier but exceeded the Wall Street forecast of $0.41.
"Although the consumer environment remains mixed, we generated sales growth across all of our geographies and channels, as clients responded well to our new styles and outerwear offering," Aritzia CEO Jennifer Wong said in a statement.
"As expected, we saw sequential margin improvement in the third quarter, and we made ongoing progress in executing against our Fiscal 2024 priorities."
In a note to clients, UBS analysts raised their target price on Aritzia stock by 2.5% to C$39 per share, noting they expect ongoing EPS growth acceleration into fiscal 2025 given favorable sales, inventory, and margin trends.
The analysts added that Aritzia’s 0.5% year-over-year growth in same store sales, which handily exceeded the consensus forecast for a 3.9% decline, reflects an improvement in the company's product assortment that should be a key driver to a fiscal 2025 sales recovery.