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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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<ul><li>Stocks have had a few good weeks and last week was another. The furniture/furnishings group has focused on restoring and defending margins.</li><li>The “rolling recession” rolled over the sector this year. Despite sales pressure, earnings improved for the best in the group, notably the commercial/contract names, residential manufacturers, and select retailers.</li><li>Costco, which includes furniture in its broad merchandise mix, reported 1QFY24 revenue of $57.8 billion, matching estimates. </li></ul>

Stocks have had a few good weeks and last week was another. The furniture/furnishings group has focused on restoring and defending margins.The “rolling recession” rolled over the sector this year. Despite sales pressure, earnings improved for the best in the group, notably the commercial/contract names, residential manufacturers, and select retailers.Costco, which includes furniture in its broad merchandise mix, reported 1QFY24 revenue of $57.8 billion, matching estimates. 

Furniture/Furnishings Weekly - Costco Shows Why It's Best in Class

<ul><li>Hooker Furniture results highlighted the past week in the furniture/furnishings space.</li><li>Hooker reported EPS of $0.65 on sales of $116.8 million, both ahead of FactSet consensus estimates of $0.28 and $116.3 million, respectively.</li><li>A year ago, Hooker reported EPS of $0.42.</li></ul>

Hooker Furniture results highlighted the past week in the furniture/furnishings space.Hooker reported EPS of $0.65 on sales of $116.8 million, both ahead of FactSet consensus estimates of $0.28 and $116.3 million, respectively.A year ago, Hooker reported EPS of $0.42.

Furniture/Furnishings Weekly - Hooker Furniture Beats on Improved Margins

<ul><li>During the past two weeks, key big-box retailers reported the quarter ended in October, providing near real-time views into the state of the consumer and retailing.</li><li>Top-line results were mixed.</li><li>Our Read: Consumer spending continues to retreat from the pandemic bubble, with consumers moving down market to low-price and bargain retailers.</li></ul>

During the past two weeks, key big-box retailers reported the quarter ended in October, providing near real-time views into the state of the consumer and retailing.Top-line results were mixed.Our Read: Consumer spending continues to retreat from the pandemic bubble, with consumers moving down market to low-price and bargain retailers.

Furniture/Furnishings Weekly - A Glance at Big-Box Retailers Shows Mixed Top Line

<ul><li>Last week, we considered our outlook for furniture and furnishings. Today, we look at current indicators.</li><li>Economic fundamentals largely deteriorated over the past two weeks, but the stocks surged as interest rates eased.</li><li>Existing home sales dipped to a seasonally adjusted rate of 3.96 million in September, the first reading below 4 million since 2010, shortly after the Great Recession. </li></ul>

Last week, we considered our outlook for furniture and furnishings. Today, we look at current indicators.Economic fundamentals largely deteriorated over the past two weeks, but the stocks surged as interest rates eased.Existing home sales dipped to a seasonally adjusted rate of 3.96 million in September, the first reading below 4 million since 2010, shortly after the Great Recession. 

Furniture/Furnishings Weekly - Falling Rates Lift All Stocks

<ul><li>Following a spate of earnings last week and major retailer earnings ahead, we pause here to reflect on where the furniture and furnishings sectors—residential and commercial/contract— are now and a peek at their likely tracks in the early 2024.</li><li>Where are we in broad strokes? Residential: Following demand surges fueled by a once-in-a-lifetime focus by consumers on their homes during the pandemic, residential furniture and furnishings demand slumped as the focus shifted to “experiences” from goods.</li><li>Commercial: New demand (orders) didn’t enjoy the surge (though backlog deliveries fueled reported sales).</li></ul>

Following a spate of earnings last week and major retailer earnings ahead, we pause here to reflect on where the furniture and furnishings sectors—residential and commercial/contract— are now and a peek at their likely tracks in the early 2024.Where are we in broad strokes? Residential: Following demand surges fueled by a once-in-a-lifetime focus by consumers on their homes during the pandemic, residential furniture and furnishings demand slumped as the focus shifted to “experiences” from goods.Commercial: New demand (orders) didn’t enjoy the surge (though backlog deliveries fueled reported sales).

Furniture/Furnishings Weekly - Looking Ahead: What We Expect in 2024

United States

Ethan Allen Interiors Inc. designs, manufactures, sources, sells, and distributes a range of home furnishings and accessories. The Company offers a variety of products including case goods items, such as beds, dressers, tables, chairs, buffets, entertainment units, home office furniture, and wooden accents. Ethan Allen Interiors serves clients worldwide.

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Ethan Allen Interiors (ETD US)

Furniture/Furnishings Weekly - Costco Shows Why It's Best in Class

Stocks have had a few good weeks and last week was another. The furniture/furnishings group has focused on restoring and defending margins.

Water Tower Research

Furniture/Furnishings Weekly - Hooker Furniture Beats on Improved Margins

Hooker reported EPS of $0.65 on sales of $116.8 million, both ahead of FactSet consensus estimates of $0.28 and $116.3 million, respectively.

Water Tower Research

Furniture/Furnishings Weekly - A Glance at Big-Box Retailers Shows Mixed Top Line

During the past two weeks, key big-box retailers reported the quarter ended in October, providing near real-time views into the state of the...

Water Tower Research

Furniture/Furnishings Weekly - Falling Rates Lift All Stocks

Existing home sales dipped to a seasonally adjusted rate of 3.96 million in September, the first reading below 4 million since 2010, shortly after...

Water Tower Research

Furniture/Furnishings Weekly - Looking Ahead: What We Expect in 2024

Following a spate of earnings last week and major retailer earnings ahead, we pause here to reflect on where the furniture and furnishings...

Water Tower Research

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