The e-commerce company 1-800 Flowers (FLWS) offers a range of products for various occasions in the United States and globally. Fresh flowers, floral and fruit arrangements, plants, and other personalized products are among the company’s offerings.
Let’s take a look at what has changed in the company’s key risk factors that investors should know. (See FLWS stock charts on TipRanks)
1-800 Flowers Risk Factors
According to the new Tipranks Risk Factors tool, 1-800 Flowers’ main risk category is Ability to Sell, which accounts for 26% of the total 42 risks identified for the stock. The next two major risk factor contributors are Finance & Corporate, and Tech & Innovation, which stand at 17% each.
Since June, the company has added one new risk factor under Finance & Corporate. Under the Corporate Activity and Growth, the company said, “Our recent growth rates may not be sustainable or indicative of our future growth.”
According to 1-800 Flowers, the COVID-19 pandemic, which resulted in home confinement and the closure of multiple brick-and-mortar establishments, prompted significant e-commerce sales growth for the company.
However, now that the COVID-19 crisis is under control and physical stores have reopened, the firm warns investors that it may not be able to maintain its rapid revenue growth rates in the future, and this uncertainty in sales volume could affect the company’s share price.
On the brighter side, the overall sector average for the Finance & Corporate risk factor is 34.7%, higher than the average risks in that category for 1-800 Flowers, which is just 16.7%.
1-800 Flowers Financial Performance
Now let us dive into the company’s financial performance for the fiscal fourth quarter ended June 27, 2021.
1-800 Flowers reported strong revenue and earnings growth, exceeding analysts’ expectations.
Revenues were $487 million, up 16.5% year over year and slightly higher than the consensus estimate of $472.8 million. The top-line growth was driven by strength in the company’s e-commerce and other businesses.
Meanwhile, 1-800 Flowers posted earnings of $0.20 per share that came in slightly above the consensus estimates of $0.19 per share. However, earnings decreased 13% on a year-over-year basis.
1-800-FLOWERS.COM CEO Chris McCann remains optimistic about the company’s strong revenue growth in fiscal 2022. The company guided total revenue growth of 10%-12% year-over-year for fiscal 2022.
McCann said, “Our guidance for double-digit revenue growth in fiscal 2022 is based on several factors, including the significant shift of consumers to ecommerce shopping, which we anticipate will continue, the tremendous growth and positive behaviors we have seen in our customer files and our significantly expanded product offering.”
Analysts’ Take on FLWS
In response to fiscal Q4 earnings results, Noble Financial analyst Michael Kupinski maintained a Buy rating on FLWS and a price target of $47. This implies 55% upside potential to current levels.
Kupinski said, “We believe that the enhanced revenues during Covid set the stage for favorable revenue growth going forward as the company markets to the new customers, increases its loyalty-based customers, Passport, and develops new products.”
Overall, 1-800 Flowers stock commands a Strong Buy consensus rating, based on 3 Buys. As for price targets, the average FLWS price target is $51.00, reflecting a potential 12-month upside of 68.2% from current levels.