Quick Win by the Algorithm: Stein Mart, Inc. (NASDAQ: SMRT) Returns up to 230.21% in 3 Months

“Fashion is part of the daily air and it changes all the time, with all the events. You can even see the approaching of a revolution in clothes. You can see and feel everything in clothes.”

– Diana Vreeland

(Source: Flickr)

Stein Mart, Inc. is a national discount retailer offering fashion merchandise, services, and presentations of a department or specialty store. The company sells clothes, accessories, and home fashion to both men and women. The company’s target audience are women over 45 with household income of around $100,000 a year. Incorporated on October 14, 1983, Stein Mart operates over 280 stores in over 30 states.

On March 13th, I Know First gave a bullish 3 month forecast of SMRT. Over that 3 month period, SMRT saw a return of 230.21%

(Source: YCharts)

Why did SMRT see such a huge return in 3 months? The answer is due to the company’s impressive 2017 Q4 and fiscal 2017 earnings announced on March 15th.

Shocking 2017 Q4 Earnings

On March 15th, SMRT announced 2017 Q4 earnings. To investor’s surprise, operating income was $4.1 million compared to a Q3 operating loss of $23.881 million. Net loss per share increased by $.1 from the previous year, resulting in $.01 loss per share, beating expectations. Also, gross profit increased by $34.18 million from Q3. Following this news, stock prices increased by 23.3%.

All this comes from 2017 being a transition year for the company as they hope to become more efficient. Hunt Hawkins, CEO, stated that, “We have updated our assortment and improved inventory productivity through reduced inventory levels, changes to receipt flow and better markdown practices. We also launched a new advertising campaign, cut expenses and capital spending, and expanded e-Commerce by adding ship-from-store fulfillment.”

Keeping the Ball Rolling in 2018

With the company focused and determined to become more efficient, 2018 Q1 saw even greater improvements in earnings when announced on May 23rd. Operating income increased by $5.731 million from the previous quarter. Net income finally became positive for the company, increasing from fiscal 2017 Q4 of -$145,000 to $7.334 million. Stock price grew 11.3% after hours following this news.

Hunt Hawkins stated, “With better first quarter results, we now expect first-half operating income to be in excess of $10 million instead of the $8 million we previously discussed.  Also, while it is early in the second quarter, we are pleased with May’s positive comparable sales trend which reflects the return of seasonal temperatures.”

After both 2017 Q4 earnings and 2018 earnings, stock price increased significantly due to their strong reports. Thus, both earnings beat expectations significantly. Investors are interested in Stein Mart’s new business strategy and are confident in future returns as 2017 Q4 and 2018 Q1 demonstrated promising results.

On March 13th, I Know First gave a bullish 3 month forecast on Stein Mart, Inc. (NASDAQ: SMRT). The Forecast shows a signal of 159.81 and a predictability of .57. In agreement with the forecast, SMRT has returned 230.21% over the three month period, demonstrating the accuracy of the I Know First algorithm.

Current I Know First subscribers received this bullish SMRT forecast on March 13, 2018

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