Bidz.com posts Q3 results above Street's view
Jewelry auctioneer Bidz.com, Inc. (Nasdaq: BIDZ), after Monday’s close posted third-quarter results above the Street’s view and raised full-year revenue guidance, pushing shares up to a new 52 week high today.
Shares of Bidz.com bolted 16.16%, or $2.36, to a new 52 week high of $16.96 at 12:46 p.m. ET. Shares of Bidz.com have been trading in the range of $4.90 to $15.19 for the past 52 weeks.
For the three months ended Sept. 30, the Culver City, Calif.-based company recorded net income of $3.6 million, or $0.14 per share, a 27% surprise above the Thomson mean earnings estimate of $0.11 per share. For the third quarter of 2006, net income was $997,000, or $0.04 per share. The small cap said the increase in net income was due primarily to higher gross profit margins on increased revenues.
Net revenue was $40.1 million, a 48% increase over the $27.1 million reported for the third quarter of 2006. Analysts polled by Thomson had anticipated revenues of $37.71 million.
Bidz.com attributed the increase to growth in demand for its jewelry products and the increase in average sales amount per order. During the third quarter, the company said it lowered its acquisition cost per new buyer and increased its number of new buyers, orders per day, while increasing its average order value.
Gross margin grew to 31.7%, compared with 24.6% in the same period of 2006 due to amortized co-op marketing contributions that reduced the company’s cost of sales by $833,000 or 2.1% of net revenue.
The company said it anticipates gross margins for the fourth quarter to continue to improve over last year on account of continued receipt of co-op marketing dollars and continued elimination of any major shipping promotions.
Going forward the company reiterated revenue guidance for the fourth quarter and raised revenue guidance for the full year based on a sanguine holiday season outlook.
Bidz said it expects revenues for the fourth quarter to be in the range of $56 million to $58 million, compared with $37.63 million earned in the fourth quarter of 2006. Three analysts polled by Thomson Financial are forecasting revenues of $53 million.
For the full year of 2007, the company has increased its revenue guidance to $180 million to $182 million and has increased its expected gross margin guidance to approximately 27% to 28%. Three analysts polled by Thomson Financial were forecasting revenues of $174.53 million. The company racked in $131.82 million for 2006.
Bidz also introduced new guidance for 2008 and expects revenues to be in the range of $225 million to $230 million. Three analysts polled by Thomson Financial are forecasting revenues of $223.74 million.
BIDZ said it expects fully taxed 2008 GAAP EPS of $0.47 to $0.51.
