National Vision Holdings, Inc. EYE delivered an adjusted EPS (earnings per share) of 12 cents in the third quarter of 2024 compared with 11 cents in the year-ago period. The figure surpassed the Zacks Consensus Estimate of 5 cents.

The GAAP income from continuing operations was 3 cents per share compared to an EPS of 23 cents in the prior-year quarter.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Following the earnings announcement on Nov. 6, shares of EYE dropped 3.1%, closing at $11.82 yesterday.

National Vision’s Q3 Revenues

During the nine months ended Sept. 28, 2024, the company’s Walmart store operations, including the former Legacy reportable segment and components of the Corporate/Other category, met the requirements to be classified as discontinued operations. As of Sept. 28, 2024, the company operates under one reportable segment, Owned & Host.

Net revenues from continuing operations in the third quarter totaled $451.5 million, which missed the Zacks Consensus Estimate by 0.03%.

The top line rose 2.9% from the year-ago quarter’s number, driven by growth from new store sales and Adjusted Comparable Store Sales Growth and the effect of unearned revenues.

In the third quarter, comparable store sales growth was 1.4% year over year. Adjusted comparable store sales growth was 0.9%. National Vision opened 18 new stores and ended the period with 1,231 stores. Overall, the store count rose 4.9% year over year.

National Vision’s Q3 Margin Performance

On a consolidated basis, the gross profit in the third quarter rose 2.6% from the prior-year quarter’s level to $261.6 million. The gross margin expanded 110 basis points (bps) despite a 3.3% rise in the cost of revenues (comprising products, services and plans).

SG&A expenses fell 1.6% year over year to $224 million. The adjusted operating margin was 8.3%, which expanded 207 bps year over year.

National Vision Holdings, Inc. Price, Consensus and EPS Surprise

National Vision Holdings, Inc. price-consensus-eps-surprise-chart | National Vision Holdings, Inc. Quote

National Vision’s Financial Position

National Vision exited the third quarter with cash and cash equivalents of $81.2 million compared with $179.5 million at the end of the second quarter.

The cumulative net cash flow from operating activities at the end of the quarter was $103.4 million compared with $153.3 million a year ago.

National Vision’s 2024 Outlook

National Vision reaffirmed its outlook for 2024 for the 52 weeks ending Dec. 28, 2024.

Full-year net revenues are expected in the range of $1.820-$1.840 billion (unchanged). The Zacks Consensus Estimate for fiscal 2024 revenues currently stands at $1.83 billion.

Adjusted comparable store sales are expected to grow 0.5%-1.5% (unchanged). Adjusted EPS is estimated in the band of 45-50 cents (unchanged). The Zacks Consensus Estimate for the same is currently pegged at 46 cents.

An Update on National Vision’s Portfolio Review

In a separate release, the company announced the results of its comprehensive store fleet review. In August 2024, National Vision disclosed that it had identified an initial list of less than 5% of its total fleet that was not meeting its profitability thresholds. It plans to close 39 of those stores by the end of fiscal 2026 and convert four Eyeglass World stores to America’s Best by the end of fiscal 2024.

In fiscal 2025, the company will temporarily moderate new store openings to 30-35 new stores. After that time, it expects to return to its more recent store opening cadence as its initiatives gain traction. 

Our Take on National Vision

National Vision delivered better-than-expected earnings in the third quarter of 2024, while revenues missed estimates. However, the top and bottom lines rose on a year-over-year basis. America’s Best continued to drive the sales performance supported by strength in the company’s managed care business.

In addition, customers responded well to National Vision’s Wise Buys eyeglass promotion, which helped enhance the value offering and attract new customers. The company is capitalizing on its remote capabilities to expand exam capacity and provide doctors with convenient new ways to practice.

National Vision has shown progress in key aspects of its transformation, including the completion of its store fleet review, the implementation of new traffic-driving initiatives, the expansion of exam capacity and remote exam efficiency and the benefit of its strengthened execution team. The expansion of both margins in the quarter is highly encouraging.

EYE’s Zacks Rank and Key Picks

National Vision currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks from the broader medical space are Haemonetics HAE, Intuitive Surgical ISRG and Boston Scientific Corporation BSX.

Haemonetics reported second-quarter fiscal 2025 adjusted earnings of $1.12 per share, which surpassed the Zacks Consensus Estimate by 2.8%. Revenues of $345.5 million beat the consensus mark by 0.7%. HAE carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

HAE’s fiscal 2025 earnings are expected to surge 15.9%. The company’s earnings surpassed estimates in three of the trailing four quarters and missed on one occasion, with the average surprise being 2.8%.

Intuitive Surgical, currently carrying a Zacks Rank #2, posted a third-quarter 2024 EPS of $1.84, beating the Zacks Consensus Estimate by 11.5%. Revenues of $2.04 billion surpassed the Zacks Consensus Estimate by 1.2%.

ISRG has an estimated 2024 earnings growth rate of 20.1% compared with the industry’s 13.8% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 10.9%.

Boston Scientific Corporation, currently carrying a Zacks Rank #2, reported third-quarter 2024 adjusted earnings of 63 cents per share, which surpassed the Zacks Consensus Estimate by 8.6%. Revenues of $4.21 billion beat the Zacks Consensus Estimate by 4.5%.

BSX has an estimated 2024 earnings growth rate of 17.6% compared with the industry’s 11.5% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 7.2%.

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