Floor & Decor Holdings (NYSE:FND) shares tumbled 16% in pre-open Friday after the company reported its third-quarter earnings and updated its full-year outlook.
Earnings per share of 61 cents on revenue of $1.11 billion were compared to the analyst expectations for a profit per share of 56 cents on revenue of $1.13 billion.
“Amidst the continuing economic challenges posed by rising mortgage interest rates, near-record-low existing home sales, ongoing pressure on housing affordability, and slowing sales of large ticket discretionary products, we are pleased to deliver third-quarter diluted earnings per share of $0.61,” Tom Taylor, Chief Executive Officer, stated.
The company now sees full-year EPS at $2.19 (up or down 5 cents), missing the consensus of $2.39 billion. Revenue is expected in the range of $4.345-4.385 billion, again below the expected $4.475 billion.
Analysts at Telsey Advisory Group lowered the price target by $15 to $75 per share.
“In the near term, Floor & Decor’s business is likely to remain under pressure from the negative housing market trends and less consumer appetite for big ticket projects. In the long term, we continue to believe Floor & Decor will be a disruptor and market share gainer in the flooring space,” the analysts said.
Analysts at Goldman Sachs took note of negative management comments on the call, highlighting that same-store sales “have experienced an unexpected and accelerated decline.”
The analysts cut the price target by $11 to $71 per share.