During market hours today, Canadian retailer The North West Company (TSE: NWC) released its Fiscal Q4-2022 and full-year earnings results. Both earnings per share (EPS) and revenue beat expectations. As a result, the stock finished 2.77% higher today.
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Q4-2022 Results
The North West Company’s revenue of C$635.2 million grew 9.7% year-over-year, beating the consensus estimate of about C$607 million. Additionally, NWC’s adjusted earnings per share came in at C$0.75, higher than both last year’s figure of C$0.71 and the C$0.52 consensus estimate. Also, its Q4 adjusted net income of C$38.1 million grew by 17.9% year-over-year compared to last year’s figure of C$32.3 million.
Further, North West’s adjusted EBITDA rose by 15.3% to C$77.3 million compared to C$67.1 million in Q4 2021. Lastly, its overall gross profit grew by 8.9%, slightly lower than the revenue growth rate, as NWC’s gross profit margin dropped by 23 basis points due to inflationary pressure, markdowns, and a change in sales mix.
Full-Year Results
On a full-year basis, revenue grew by 4.6% to C$2.35 billion. The company attributed its sales growth to a few factors, namely foreign exchange rate tailwinds, higher sales in other areas of Canadian Operations such as airline revenue, financial services, retail fuel, and pharmacy, as well as the addition of new stores. Rising inflation also played a role in the increase. It’s worth noting that when excluding the impact of foreign exchange rates, sales grew by 2.6%.
Adjusted net earnings, on the other hand, fell by 11.3% year-over-year but were still 80.5% higher than the pre-pandemic adjusted earnings figure from 2019.
Is NWC Stock a Buy, According to Analysts?
NWC stock earns a Hold rating on TipRanks based on just one Hold assigned in the past three months by TD Securities analyst Michael Van Aelst. Moreover, NWC stock’s price target of C$39.00 implies upside potential of 4.1%.
