Kate Spade shares fall after lower guidance issued
Kate Spade & Co. shares dropped 0.8% in Wednesday premarket trading after the clothing and accessories company lowered its full-year 2016 guidance. Second-quarter net income totaled $26.8 million, or 21 cents per share, up from $8.5 million, or 7 cents per share, for the same period a year ago. Adjusted earnings were 19 cents per share, beating the 14 cents per share FactSet consensus. Revenue for the quarter was $319.7 million, up from $281.1 million for the same period last year and above the $318 million FactSet estimate. The results fell below the company's expectations due largely to the retail landscape and tourist headwinds, according to Craig Leavitt, chief executive of Kate Spade. Kate Spade updated its full-year 2016 guidance, now expecting sales between $1.37 billion and $1.40 billion, down from previous revenue guidance in the range of $1.39 billion to $1.41 billion. The company now expects earnings per share in the range of 63 cents to 70 cents, down from previous guidance of 70 cents to 80 cents. Full-year FactSet estimates are for sales of $1.408 billion and earnings of 78 cents per share. Kate Spade shares are up 13.3% for the year so far, while the S&P 500 Index is up 5.5% for the same period.
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