Shares of footwear and accessories retailer Designer Brands, Inc. (DBI) have jumped 89.8% over the past year. DBI recently a reported better-than-expected third-quarter performance on its bottom-line front.
Revenue increased 30.7% year-over-year to $853.5 million, but fell short of analysts’ expectations by $44 million. Due to an expansion in margins, earnings per share at $0.86 exceeded estimates by $0.30. During this period, comparable sales rose 40.8% over the prior year.
At the end of October, DBI had 515 stores in the U.S. and 144 stores in Canada. With these developments in mind, let us take a look at the changes in DBI’s key risk factors that investors should know.
According to the TipRanks Risk Factors tool, Designer Brands’ top risk category is Ability to Sell, contributing 30% to the total 27 risks identified. In its recent quarterly report, the company has added one key risk factor under the Legal & Regulatory risk category.
DBI highlighted that amid the COVID-19 pandemic, vaccine mandates and other regulations could have an adverse impact on the company. A vaccination requirement may lead to employee attrition, while also impacting DBI’s ability to onboard new talent.
Compared to a sector average Ability to Sell risk factor of 17%, DBI’s is at 30%.
Hedge Fund Activity
According to TipRanks data, the best hedge funds on Wall Street have increased holdings in Designer Brands by 37.4 thousand shares in the last quarter, indicating a neutral hedge fund confidence signal in the stock based on activities of 4 hedge funds in the recent quarter.
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