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Cimpress (CMPR) Up 44.2% Since Last Earnings Report: Can It Continue?

A month has gone by since the last earnings report for Cimpress (CMPR). Shares have added about 44.2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Cimpress due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Cimpress (CMPR) Shares Decline 8% Since Q1 Earnings Release

Cimpress reported lackluster first-quarter fiscal 2022 results, wherein earnings missed the Zacks Consensus Estimate by 9% and sales missed the same by 1.9%.

CMPR incurred an adjusted loss of 97 cents per share, wider than the Zacks Consensus Estimate of a loss of 89 cents. Cimpress reported EPS of 9 cents per share in the year-ago quarter.

Top-Line Details

Total revenues in the fiscal first quarter were $703.4 million, reflecting an increase of 7% from $657.6 million in the year-ago quarter. The organic constant-currency revenue growth was 14%, driven by growth across all businesses and markets through increased pricing and customer demand. However, the top line missed the consensus estimate of $717 million.

Segmental Information

The National Pen segment generated revenues of $81.7 million, up from $69.3 million in the prior-year quarter. Vistaprint — the largest revenue-generating segment — reported aggregate revenues of $369.4 million, up from $349.5 million in the year-ago quarter.

The Upload and Print segment’s revenues increased to $209.4 million from $198 million in the year-ago quarter. The segment consists of two subgroups, namely PrintBrothers and The Print Group. PrintBrothers’ revenues increased to $132.7 million from $125.4 million. The Print Group generated revenues of $76.8 million, up from $72.8 million. Revenues from All Other Businesses increased to $51.8 million from $47.9 million.

Margin Details

In the quarter, Cimpress' cost of revenues was $377.7 million, up 11.4% on a year-over-year basis. The metric represented 53.7% of total revenues. Total selling, general & administrative expenses were $255 million, up 15.3%. The same represented 36.3% of total revenues in the quarter.

Gross profit increased 2.2% year over year to $326 million. The margin was 46.3%, down 220 basis points due to inflationary pressure on input costs and product mix shifts in Vista. Net interest expenses fell 3.5% to $24.8 million.

Balance Sheet and Cash Flow

As of Sep 30, 2022, Cimpress had $132.1 million of cash and cash equivalents compared with $277.1 million at the end of the fourth quarter of fiscal 2022. Also, CMPR’s total debt (net of issuance costs) was $1,664.4 million. In the fiscal first quarter, Cimpress refrained from buying back shares.

In fiscal 2022, net cash used in operating activities was $25.3 million against $36.6 million cash provided a year ago.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

The consensus estimate has shifted -16.46% due to these changes.

VGM Scores

At this time, Cimpress has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Cimpress has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Cimpress is part of the Zacks Consumer Services - Miscellaneous industry. Over the past month, Aaron's Company, Inc. (AAN), a stock from the same industry, has gained 12.9%. The company reported its results for the quarter ended September 2022 more than a month ago.

Aaron's reported revenues of $593.38 million in the last reported quarter, representing a year-over-year change of +31.2%. EPS of $0.31 for the same period compares with $0.83 a year ago.

For the current quarter, Aaron's is expected to post a loss of $0.01 per share, indicating a change of -101.7% from the year-ago quarter. The Zacks Consensus Estimate has changed -200% over the last 30 days.

Aaron's has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.

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