Michael Kors is crashing
(Getty)
Shares of Michael Kors fell by more than 23% on Wednesday after the company reported fourth-quarter earnings.
Before the market open, the fashion retailer reported diluted earnings per share of $0.90, just below analysts' estimate for $0.91, according to Bloomberg.
The company posted sales of $1.1 billion, up 17.8% from the previous quarter and more than the estimate for $1.09 billion.
The company's guidance was weak. In its outlook, it said it expected "a low double-digit comparable-store-sales decrease on a reported basis and a mid-single-digit decrease on a constant currency basis" for the first fiscal quarter.
In the earnings release, CEO John Idol wrote: "While we were faced with a number of headwinds in the fourth quarter, we were pleased with the strong performance across our segments and geographies.
"We believe that our results demonstrate the strength of the Michael Kors brand," he added, "as our luxury products continue to resonate with consumers worldwide."
For the fiscal year, sales increased 32% to $4.4 billion from $3.3 billion in fiscal 2014, the company said.
For the full year, it expects revenues of between $4.7 billion and $4.8 billion and diluted earnings per share of between $4.40 and $4.50.
Michael Kors shares are down 37% year-to-date and 50% for the past 12 months.
In a note, Piper Jaffray analysts wrote that shares will likely open lower and they will not be buying the stock on the weakness (with the expectation that it will rise.)
Erinn Murphy and Eric Johnson wrote, "We still believe guidance may be too optimistic given comps [comparable store sales] are now in negative territory and FY16 guidance predicated on a positive low single digit constant currency comp."
Here's a chart showing the drop in shares on Wednesday:
(Google Finance)
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