Inter Parfums Inc. - Growth & Income

Inter Parfums, Inc. (IPAR) saw sales rise 22% on record results for the second quarter as consumers resumed purchases of luxury perfumes.

Inter Parfums manufactures perfumes and cosmetics under worldwide licensing deals with well-known brands such as Burberry, Van Cleef & Arpels, Jimmy Choo, Paul Smith, Montblanc and S.T. Dupont.

The company also produces personal care products for a host of specialty retailers such as the Gap, Banana Republic, Brooks Brothers, and bebe. It just entered into agreements with Betsey Johnson and Nine West which will see product launches in 2011.

Inter Parfums Reported Record Results

On Aug 9, Inter Parfums reported its second quarter results which beat the Zacks Consensus by a penny. Earnings per share were 18 cents compared to the 14 cents earned in the year ago period.

Sales rose 22% to $107.8 million from $88.6 million primarily due to U.S.-based operations boosting the quarter as sales rose 71%.

European-based operations, the largest segment, saw sales rise 16% to $91.9 million from $79.4 million.

Gross margin also expanded to 60% from 57%.

Guidance Raised

Given the record results, it's not a surprise that Inter Parfums raised full year guidance to 82 cents from its previous guidance of 78 cents provided in May.

Finding the Growth

Analysts had been a bit more bullish, given that the company had announced preliminary results in late July, so some estimates were recently revised lower for 2010. Out of 8 estimates, 4 are higher and 2 lower in the last 30 days.

The 2010 Zacks Consensus is calling for 84 cents, up a penny in the last month, and higher than the company's guidance. This is earnings growth of 7.1%.

Analysts are more optimistic about growth in 2011, expecting another 16.2%.

Over the next five years, earnings growth is forecast at 13.5%, higher than the industry average of 10.9%.

Income Higher Than the Industry

Okay, so the industry average for the dividend payout is zero. It's not too hard to beat that, right?

Inter Parfums pays a dividend currently yielding 1.6%, however, which is a nice bonus for shareholders.

Inter Parfums is a Zacks #2 Rank (buy) stock.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

 
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