Movado Reports Q1 Sales Growth Amid Economic Uncertainty
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Source: seekingalpha
- Sales Growth: Movado reported a Q1 non-GAAP EPS of $0.32 with net sales of $142.4 million, reflecting an 8.0% increase from $131.8 million in Q1 fiscal 2026, driven by strong performance across owned and licensed brands.
- U.S. Market Performance: U.S. net sales increased by 8.7% year-over-year, indicating a rebound in consumer demand that enhances the company's competitive position domestically and lays a foundation for future sales growth.
- International Market Dynamics: International net sales rose by 7.6%, with a constant dollar growth of 1.6%, demonstrating the company's ability to adapt well to external economic challenges despite the ongoing geopolitical uncertainties.
- Dividend Increase and Outlook: The board approved a $0.05 increase in quarterly dividends to $0.40 per share; however, due to uncertainties from the Middle East conflict, the company has opted not to provide a fiscal 2027 outlook, reflecting a cautious approach to future market fluctuations.
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Analyst Views on MOV
Wall Street analysts forecast MOV stock price to fall
3 Analyst Rating
3 Buy
0 Hold
0 Sell
Strong Buy
Current: 35.590
Low
30.00
Averages
30.50
High
31.50
Current: 35.590
Low
30.00
Averages
30.50
High
31.50
About MOV
Movado Group, Inc. designs, sources, markets and distributes watches globally. The Company operates through two segments: Watch and Accessory Brands and Company Stores. The Company’s Watch and Accessory Brands segment includes the designing, manufacturing and distribution of watches and, to a lesser extent, jewelry and other accessories, of owned and licensed brands, in addition to after-sales service activities and shipping. The Company Stores segment includes the Company’s retail outlet business. Its portfolio of watch brands comprises owned brands MOVADO, CONCORD, EBEL, OLIVIA BURTON and MVMT, as well as licensed brands COACH, TOMMY HILFIGER, HUGO BOSS, LACOSTE and CALVIN KLEIN. The Company also designs, sources, markets and distributes jewelry and other accessories under of its brands. It divides its business into two geographic locations: United States operations, and International, which includes the results of all non-U.S. Company operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Increased Shareholder Returns: The Board approved a quarterly cash dividend increase from $0.35 to $0.40 per share, reflecting the company's strong liquidity position with $225.3 million in cash and no debt, enhancing shareholder confidence.
- Market Demand Dynamics: Despite challenges in the Middle East, Movado observed a resurgence in the fashion watch category among younger consumers, highlighted by the quick sell-out of the limited edition 23-millimeter Baby Face watch, showcasing the brand's appeal in the youth market.
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- Yield Performance: The forward yield of 5.37% indicates the company's attractiveness in the current market environment, potentially drawing in more income-seeking investors and enhancing shareholder value.
- Payment Schedule: The dividend is payable on June 24, with a record date of June 10 and an ex-dividend date also on June 10, ensuring that existing shareholders can promptly benefit from the increased returns, thereby reinforcing shareholder loyalty.
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- Profitability Improvement: The adjusted earnings per share rose to $0.32, significantly up from $0.08 in the same quarter last year and surpassing expectations by $0.25, reflecting improvements in cost control and operational efficiency.
- Dividend Increase: The board approved a 14% increase in the quarterly dividend to $0.40 per share, demonstrating the company's strong financial position and confidence in its long-term prospects, despite facing economic and geopolitical uncertainties.
- Guidance Withdrawal Impact: Movado's decision to refrain from providing fiscal year guidance due to concerns over current economic and geopolitical conditions led to a more than 12% drop in shares before the market opened, eliciting a strong reaction from investors.
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- Sales Growth Moderation: The company anticipates a moderation in net sales growth for the second quarter, reflecting the challenges in the market environment that could impact overall performance and shareholder confidence.
- Dividend Increase: The Board of Directors approved an increase in the quarterly dividend from $0.35 to $0.40 per share, payable on June 24, 2026, which aims to reward shareholders and bolster investor confidence in the company.
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