Why Movado stock took a hit on Thursday

Many of the The Movado Grouphis (PURPLE -14.66%) the goods are quite attractive, but the company’s stock didn’t look too good on Thursday. Amid dismal quarterly results, investors pulled away from the stock, leaving the price down nearly 15% at the market close. benchmark S&P 500 the index fared much better by comparison, “only” falling 0.3% during the session.

Revenues and profitability are falling

In Movado’s fiscal 2025 second quarter, the watch and fashion conglomerate posted net sales of $159.3 million, down slightly from $160.4 million in the same quarter a year earlier. GAAP net income fell much more sharply to $3.7 million ($0.16 per share) from more than $8 million in Q2 2024.

Movado is not a stock closely followed by analysts, so consensus estimates were not available. The company did not meet its own expectations during the period; quoted CEO Efraim Grinberg as saying this was due to a “challenging consumer spending environment, exacerbated by increased spending to support future growth.”

The company also declared a new quarterly dividend. Compared to its nine predecessors, it will be $0.35 per share, payable on September 30 to investors of record as of September 16. At the stock’s most recent closing price, the payout would yield 7.3%, which is quite high for a consumer goods company.

Revised guidelines below

With these conditions in mind, Movado revised its entire guidance for fiscal 2025. It now believes it will post net sales of $665 million to $675 million; previously, it was guided from $700 million to $710 million. The EPS forecast was also cut to $0.90-$1 for the year, down from $1.20 previously to $1.30.