Earnings reports can do great things for stock prices, and Designer Brands (NYSE:DBI) discovered as much for itself. Designer Brands’ earnings report struck a chord with investors, as the stock was up almost 12% at the time of writing.
First, Designer Brands posted a come-from-behind win that virtually no one saw coming. Analysts set the bar low, believing that the firm would ultimately post an EPS loss of $0.02. However, it posted a gain of $0.07 per share. In addition, revenue came in at $760.55 million, which was a miss against the $800.2 million analysts expected. Net sales for owned brands, however, were up 32.1% against this time last year.
Roger Rawlins, Designer Brands soon-to-be-former CEO, noted that the company was engaging in a “brand building strategy” for most of 2022, and the numbers show just how well that concept worked out. Several licensing agreements offered new potential revenue. Moreover, Designer Brands looks to keep going into the year with further control over both expenses and inventory as it brings in a new CEO.
Interestingly, even as Designer Brands gains, hedge funds are neutral on the stock overall. Indeed, they sold 5,300 shares last quarter, which is the second decline in a row for hedge fund ownership.
