Shares of La-Z-Boy Incorporated (NYSE: LZB) soared 7.47% in pre-market trading on Wednesday, building on the previous day's 6.49% gain, as investors continued to react positively to the company's impressive second-quarter fiscal 2026 earnings report and strategic growth initiatives.
The furniture retailer reported adjusted earnings per share of $0.71 for the quarter, significantly outperforming the analyst consensus estimate of $0.61. Sales came in at $522.48 million, slightly above expectations of $522.41 million. Despite challenging market conditions, La-Z-Boy managed to expand its margins and deliver solid profitability, with the wholesale segment showing particular strength. The company's wholesale sales increased by 2%, while the adjusted operating margin improved to 8.1%, partly due to lower warranty expenses.
Investors were further encouraged by La-Z-Boy's positive outlook and strategic moves. The company expects Q3 sales to grow by 1-4% year-over-year, projecting a range of $525-545 million. Additionally, La-Z-Boy announced the completion of a 15-store acquisition in the southeast U.S., which is estimated to add $80 million in annual retail sales. The company also plans to optimize its portfolio by exiting non-core wholesale businesses and closing its U.K. manufacturing facility. These initiatives, coupled with a 10% increase in the quarterly dividend, have bolstered investor confidence in La-Z-Boy's future growth prospects and financial health, contributing to the stock's significant pre-market surge.
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