Brand of women’s fashion bags and accessories Vera Bradley (NYSE: VRA) shares have stumbled (-48%) during the year. The business was hit by inflationary pressures, logistical costs and rising fuel prices, which caused revenue to appear in its tax gains in the first quarter of 2023. The company suffered a net loss of ( -0.19 dollars) during the quarter. Macroeconomic pressures have primarily affected family customers with incomes below $ 55,000, while higher-income households spend more than the previous year. The company is expected to be profitable for fiscal year 2023. With $ 2 in cash per share and no long-term debt, Vera Bradley is in value territory. Vera Bradley implemented price increases during the quarter to offset some of the logistical and supply chain pressures that should begin to show in the figures in the latter part of the year. The epicenter travel industry is recovering rapidly and Vera Bradley should be a benefactor of the rebirth of leisure travel. The company is already optimizing for its major back-to-campus season with strategic improvements in product assortment. Prudent investors looking to expose themselves to a possible second-half recovery in the retail luggage and accessories segment may be wary of opportunistic setbacks from Vera Bradley’s shares.
Publication of results for the first quarter of 2023
On June 8, 2022, Vera Bradley released its fiscal results for the first fiscal quarter of 2023 for the quarter ending April 2022. The company reported a loss of earnings per share (EPS) of (-0 , $ 19) excluding non-recurring items compared to the analyst’s consensus estimates of a loss of (-0.16 $), a loss of (-0.03 $) per share. Revenue fell (-9.7%) year-on-year (year-on-year) to $ 98.50 million, missing analyst-agreed estimates of $ 109.87 million. Vera Bradley CEO Rob Wallstrom commented: “We are clearly seeing a bifurcation in our customer base spending. At Vera Bradley, Direct Channel’s full line revenue was higher than last year. , as customers with higher household incomes remained committed and spent more than last year .. We also saw a good rise in year-on-year indirect channel revenue.However, inflationary pressures, including rising of gas prices, especially affected Vera Bradley’s full-line customer spending with family incomes below $ 55,000, as well as traffic and spending at our Vera Bradley Direct Channel factory stores during the quarter. moreover, Pura Vida’s e-commerce revenue continued to be significantly affected by the shift in the effectiveness of digital and social media and the rising costs of digital media. at the balance of the year, we are taking decisive action to strengthen the company and stay very focused on our two main brands. “
Vera Bradley issued a downward guidance for the EPA for fiscal year 2023 from $ 0.35 to $ 0.50 against analysts ’consensus estimates of $ 0.61. Revenue is projected to range from $ 490 million to $ 505 million compared to $ 564.96 million.
CEO Wallstrom acknowledged the weak performance, but highlighted the price increase as a step to mitigate logistics and supply pressures, as well as drive product innovations. The company completed $ 10.5 million in share repurchases and maintained a debt-free balance sheet. He noted the bifurcation in the spending of his customers. Higher-income households remained committed and spent more money than last year, but households with incomes below $ 55,000 were affected by rising interest rates, inflation and gas prices. . Pure Life e-commerce is also experiencing a significant shift in the effectiveness of social and digital networks amid rising costs. While the focus is on strengthening its two core brands, there will be a company-wide process of efficiency and cost reduction to achieve annual savings of $ 15 million to $ 25 million. They are also evolving the Pure Life business model from pure e-commerce to omnichannel with a diverse marketing base.
Opportunistic VRA withdrawal price levels
The use of rifle charts over weekly and daily time periods provides an accurate view of the landscape for VRA stock. Weekly rifle chart breakdown continues to fall trying to break $ 4.39 Fibonacci level (fib).. The weekly stochastic formed a mini reverse puppy slip to 20-band rejection. The 5-period weekly moving average (MA) resistance falls to $ 5.20, followed by the 15-period MA to $ 6.21. The lower weekly Bollinger Bands (BB) are near the $ 3.82 fib level. The 50-week MA resistance stands at $ 8.43. The weekly Low market structure (MSL) buys activators at a break above $ 5.12. The rifle chart’s reverse puppy daily breakdown has a 5-period MA in the fall at $ 4.66 and a 15-period MA at $ 4.82. The daily stochastic rejects the 20 band as its rebound attempt is reduced again. The lowest daily BBs are at $ 3.25. Opportunistic withdrawal levels are at the level of $ 3.82 fib, $ 3.49 fib, $ 2.97 fib, $ 2.59 and the level of $ 2.24 fib. Rising trajectories range from the $ 6.00 fib level to the $ 8.38 fib level.