Carter's Q2 adjusted EPS beats estimates on improved marketing

Carter's

31/07/2026 11:12

Overview
U.S. children's apparel maker's fiscal Q2 net sales rose 5% year-over-year
Adjusted EPS for fiscal Q2 rose 53%, beating analyst expectations
Company's results driven by improved marketing and productivity initiatives

Outlook
Carter's sees 2026 net sales up 2% to 3% from $2.898 bln in 2025
Company expects high single-digit to low double-digit percentage decline in 2026 adj diluted EPS
Carter's expects 2026 operating cash flow of $230 mln to $240 mln

Result Drivers
MARKETING AND PRODUCTIVITY - Co said improved marketing and early benefits from productivity initiatives were key drivers of Q2 results
SEGMENT GROWTH - Net sales grew in U.S. Wholesale, U.S. Retail, and International segments, with U.S. Retail comparable sales up 5.1%
PRODUCTIVITY AND SUPPLY CHAIN INITIATIVES - Adjusted operating income increase was principally due to benefits from productivity and supply chain initiatives, offsetting tariff and inflation pressures

Company press release: ID:nBw6X6bHpa

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Sales
 
$615 mln
 
Q2 Adjusted EPS
Beat
$0.26
$0.06 (7 Analysts)
Q2 EPS
 
$2.87
 

Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 4 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the apparel & accessories retailers peer group is "buy."
Wall Street's median 12-month price target for Carter's Inc is $41.50, about 9.8% above its July 30 closing price of $37.79
The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 11 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)