It has been about a month since the last earnings report for Inter Parfums (IPAR Quick QuoteIPAR - Free Report) . Shares have added about 8.6% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Inter Parfums due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Inter Parfums Q4 Earnings Increase, 2023 View Rises

Inter Parfums delivered fourth-quarter 2022 results, with the top and the bottom line increasing year over year. Management raised its 2023 net sales and EPS guidance.

Results in Detail

Inter Parfums posted fourth-quarter earnings of 52 per share. Excluding asset impairment charges, the company’s adjusted earnings came in at 71 cents per share. The company posted a loss of 4 cents per share in the year-ago quarter. The Zacks Consensus Estimate for fourth-quarter 2022 was pegged at 34 cents.

Quarterly net sales increased 47% to $311 million compared with $211 million reported in the year-ago quarter. The Zacks Consensus Estimate for fourth-quarter 2022 net sales was pegged at $280.6 million.

Inter Parfums’ net sales advanced 47% to $311 million for three months ended Dec 31, 2022. At comparable currency rates, consolidated fourth-quarter net sales rose 57% year over year. For the fourth quarter, Inter Parfums’ Europe-based product sales came in at $197 million, up 45% from the 2021 levels. U.S.-based product sales amounted to $114 million, increasing 52% from the fourth quarter of 2021.

In 2022, net sales rallied 24% to $1,087 billion, a little more than management’s latest projection of $1.08 billion. At comparable exchange rates, consolidated net sales rose 30% for the full year.

In 2022, Europe-based product sales came in at $744 million, up 12% from 2021. U.S.-based product sales amounted to $343 million, rising 58% from 2021. In the fourth quarter, IPAR witnessed solid sales increases from its largest brands, including Montblanc, Jimmy Choo, Coach and GUESS?, which delivered growth of 50%, 78%, 82% and 28%, respectively. In the company’s U.S. operations, brands like Oscar de la Renta and Abercrombie & Fitch generated sales growth of 28% and 16%, respectively, in the fourth quarter. In European operations, Moncler, Kate Spade and Boucheron brands witnessed solid increases of 34%, 140% and 25%, respectively.

Inter Parfums’ fourth-quarter gross profit margin was 64.4%, up 180 basis points from 62.6% reported in the year-ago quarter. In the European-based operations, the company’s 2022 gross margin came in at 68.2%, up from 66.6% reported in the year-ago period. The upside can be attributed to pricing actions and a favorable channel mix, among others. For U.S.-based operations, the company’s 2022 gross margin stood at 54.7% compared with 53.1% reported in the year-ago period. The upside can be attributed to scale, pricing actions and favorable channel/brand mix. These factors more than offset inflationary impact.

Quarterly operating margin came in at 7.5%, up 1,326 basis points reported in the year-ago quarter. SG&A expenses for the fourth quarter amounted to $169.1 million, up from $144.1 million reported in the year-ago quarter.

Other Financial Aspects

Inter Parfums ended the quarter with cash and cash equivalents of $104.7 million, long-term debt (excluding the current portion) of $151.5 million and total equity of $788.1 million.

Inter Parfums announced an annual dividend hike of 25% to $2.50 per share. The company will pay quarterly dividend of 62.5 cents per share, payable on Mar 31, 2023, to shareholders of record as of Mar 15.

Other Updates

Management expects to unveil new products and brand extensions throughout 2023. The company’s largest European-based brand, Montblanc, will release a sister scent for the signature line and one for men in the Explorer franchise. The company will introduce Rose Passion, a new flanker for Jimmy Choo. Its Coach brand will add scents for men and women. Inter Parfums’ mid-sized brands will roll out new scents, like a collection for Moncler and Chérie by Kate Spade. It will also add some fragrance to Rochas and Van Cleef & Arpels family.

For the U.S.-based operations, every brand in the portfolio is introducing companion products for existing programs. In addition, management has a new version of GUESS Uomo and Bella Vita in the pipeline. The company is on track with launches for Abercrombie & Fitch. The company will launch its first men’s scent for MCM brand.

Guidance

Management raised its 2023 guidance. Management highlighted that it began 2023 on a solid note, with sizable orders already booked in the first two months.

For 2023, management now expects net sales of nearly $1.2 billion, up 10% year over year. The company earlier expected net sales of $1.15 billion in 2023. Management now expects 2023 earnings per share of $4.00, up 6% year over year. Earlier, the company had expected earnings of $3.75 per share. The guidance is based on the assumption of no major resurgence in coronavirus cases and the current level of the average dollar/euro exchange rate.

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month.

VGM Scores

At this time, Inter Parfums has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Inter Parfums has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.