As specialty retail stocks’ Q3 earnings season wraps, let's dig into this quarter's best and worst performers, including National Vision (NASDAQ:EYE) and its peers.
Some retailers try to sell everything under the sun, while others—appropriately called Specialty Retailers—focus on selling a narrow category and aiming to be exceptional at it. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores win with depth of product in their category as well as in-store expertise and guidance for shoppers who need it. E-commerce competition exists and waning retail foot traffic impacts these retailers, but the magnitude of the headwinds depends on what they sell and what extra value they provide in their stores.
The 4 specialty retail stocks we track reported a weaker Q3; on average, revenues were in line with analyst consensus estimates Stocks have been under pressure as inflation (despite slowing) makes their long-dated profits less valuable, but specialty retail stocks held their ground better than others, with the share prices up 3.6% on average since the previous earnings results.
Best Q3: National Vision (NASDAQ:EYE)
Operating under multiple brands, National Vision (NYSE:EYE) sells optical products such as eyeglasses and provides optical services such as eye exams.
National Vision reported revenues of $532.4 million, up 6.6% year on year, topping analyst expectations by 1.1%. It was a strong quarter for the company, with an impressive beat of analysts' earnings estimates and optimistic earnings guidance for the full year.
Reade Fahs, National Vision's CEO, said, “Our third quarter results reflect ongoing strength in our managed care business as well as continued progress on our strategic initiatives focused on expanding exam capacity, particularly within America’s Best. We delivered a solid Back to School selling season, supported by our focus on delivering incredible value while offering exceptional customer service.”
National Vision scored the fastest revenue growth and highest full-year guidance raise of the whole group. The stock is up 14.9% since the results and currently trades at $19.35.
Is now the time to buy National Vision? Access our full analysis of the earnings results here, it's free.
Tractor Supply (NASDAQ:TSCO)
Started as a mail-order tractor parts business, Tractor Supply (NASDAQ:TSCO) is a retailer of general goods such as agricultural supplies, hardware, and pet food for the rural consumer.
Tractor Supply reported revenues of $3.41 billion, up 4.3% year on year, falling short of analyst expectations by 1.7%. It was a slower quarter for the company, with full-year revenue guidance missing analysts' expectations.
Tractor Supply had the weakest performance against analyst estimates among its peers. The stock is up 16.6% since the results and currently trades at $230.78.
Is now the time to buy Tractor Supply? Access our full analysis of the earnings results here, it's free.
Weakest Q3: Petco (NASDAQ:WOOF)
Historically known for its window displays of pets for sale or adoption, Petco (NASDAQ:WOOF) is a specialty retailer of pet food and supplies as well as a provider of services such as wellness checks and grooming.
Petco reported revenues of $1.49 billion, down 0.5% year on year, falling short of analyst expectations by 1.3%. It was a weak quarter for the company, with underwhelming earnings guidance.
The stock is down 32.7% since the results and currently trades at $2.58.
Named after founder Philip Leslie, who established the company in 1963, Leslie’s (NASDAQ:LESL) is a retailer that sells pool and spa supplies, equipment, and maintenance services.
Leslie's reported revenues of $432.4 million, down 9.1% year on year, surpassing analyst expectations by 3.1%. It was a weak quarter for the company, with underwhelming earnings guidance for the full year.
Leslie's delivered the biggest analyst estimates beat but had the slowest revenue growth and slowest revenue growth among its peers. The stock is up 15.5% since the results and currently trades at $6.72.
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The author has no position in any of the stocks mentioned