Xcel Brands Exceeds Earnings Expectations Despite Revenue Miss
November 22, 2023
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Xcel Brands ($NASDAQ:XELB) recently released their quarterly earnings report, which showed that despite missing expectations on revenue, they exceeded earnings forecast. The company reported a Non-GAAP EPS of -$0.15, which was $0.11 higher than the expected amount.
However, its revenue of $2.64M fell short of the forecast by $0.1M. Xcel Brands is a leading consumer branded products and media company focused on the lifestyle and fashion markets. The company’s portfolio of owned and licensed brands include Isaac Mizrahi, Judith Ripka, H Halston, C. Wonder, and Highline Collective. They operate in the direct-to-consumer, retail, and e-commerce channels, as well as digital and social media platforms. Notably, despite the decline in Xcel Brands’ revenue, the company’s non-GAAP EPS surpassed expectations due to cost-cutting measures and lower than expected expenses. This helped Xcel Brands exceed investors’ expectations despite a revenue miss. Moving forward, Xcel Brands will continue to focus on its branding and marketing strategies to drive long-term growth and profitability.
Earnings
XCEL BRANDS recently reported its earnings for FY2023 Q2 ending June 30 2021, revealing that total revenue was 10.76M USD while net income was 1.56M USD, a 27.0% increase in total revenue compared to the same period last year, but a 116.4% decrease in net income. Over the past three years, total revenue has decreased from 10.76M USD to 6.78M USD.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Xcel Brands. More…
| Total Revenues | Net Income | Net Margin |
| 21.4 | -19.13 | -93.6% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Xcel Brands. More…
| Operations | Investing | Financing |
| -6.93 | -0.43 | 0 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Xcel Brands. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 81.49 | 20.86 | 3.14 |
Key Ratios Snapshot
Some of the financial key ratios for Xcel Brands are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -16.6% | -1.6% | -112.3% |
| FCF Margin | ROE | ROA |
| -33.6% | -23.6% | -18.4% |
Market Price
Stock in the company opened at $0.9 and closed the day at $1.0, a rise of 8.9% from the previous closing price of 0.9. The strong earnings led to an increase of investor confidence in the company, which contributed to the increase in share price. Despite the missed revenue expectations, analysts remain optimistic about the company’s future outlook and believe that XCEL Brands is well-positioned for long-term success. Live Quote…
Analysis
GoodWhale’s Star Chart analysis of XCEL BRANDS reveals that the company is strong in terms of asset, medium in profitability, and weak in dividend and growth. XCEL BRANDS has an intermediate health score of 6/10 with regard to its cash flows and debt, suggesting that it is likely to sustain future operations in times of crisis. Classified as an “elephant”, a type of company which is rich in assets after deducting off liabilities, XCEL BRANDS may appeal to a variety of investors. Those looking for steady profits and solid asset backing may find XCEL BRANDS particularly attractive. Investors who are more risk-taking and looking for high dividend payouts and rapid growth may be less interested. Overall, GoodWhale suggests that XCEL BRANDS offers a solid option for those looking for a reliable asset backed company with steady profits. More…
Peers
Xcel Brands Inc specializes in designing, producing and marketing lifestyle brands across multiple retail channels, including digital media and brick-and-mortar retail stores. Its competitors are also active in the fashion and apparel industry, offering a variety of products to meet customers’ needs.
– Delta Galil Industries Ltd ($OTCPK:DELTF)
Delta Galil Industries Ltd is a leading global manufacturer and marketer of branded and private label apparel products for men, women, and children. Headquartered in Israel, the company operates across a wide range of product categories, including underwear and socks, activewear and leisurewear, apparel for infants, and luxury items. With a market cap of 1.05 billion as of 2023, the company is well-established in the apparel industry. Delta Galil also boasts a Return on Equity (ROE) of 19.0%, an impressive figure that is indicative of the company’s strong financial performance.
– Go Fashion (India) Ltd ($BSE:543401)
Go Fashion (India) Ltd is an apparel and lifestyle company based in India. It is a leading player in the Indian apparel and lifestyle industry and has managed to achieve a market capitalization of 53.45B as of 2023. This impressive figure shows the company’s success in terms of sales and profitability, as well as its ability to attract investors. Additionally, Go Fashion (India) Ltd has managed to achieve a Return on Equity of 17.03%, which is a strong indicator of the company’s financial health, as it indicates a high rate of return on shareholders’ investments. Thus, Go Fashion (India) Ltd’s impressive market cap and Return on Equity make it one of the leading companies in the Indian apparel and lifestyle industry.
– Chausseria ($LTS:0O3A)
Chausseria is an industrial equipment manufacturer that specializes in creating tools and technology for the textile and apparel industries. Its market cap of 2.4M as of 2023 shows a steady growth in the company’s financial performance. The Return on Equity of 6.39% indicates that the company is efficiently utilizing its resources to generate profits. The company has been able to maintain a steady growth in its market capitalization, indicating that its strategies have been successful in the long run. With its strong financial performance, Chausseria has become a leading provider of cutting-edge solutions for the textile and apparel industries.
Summary
XCEL Brands recently reported a quarterly Non-GAAP EPS of -$0.15, beating the consensus forecast by $0.11.
However, the company’s revenue of $2.64M fell short of expectations by $0.1M. Despite the revenue miss, the stock price moved up the same day. This suggests that investors are becoming more optimistic in their outlook for the company, believing that other factors such as cost-cutting and improved efficiency may lead to better performance in future quarters. Therefore, investors should continue to monitor XCEL Brands closely in order to take advantage of any potential upside or downside in the short-term.
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