Telsey analyst trimmed the price forecast for Floor & Decor Holdings, Inc. (NYSE:FND) from $115 to $100 while keeping an Outperform rating.

On Thursday, the company reported first-quarter EPS of 45 cents, missing the 46 cents estimate, while net sales of $1.16 billion were inline.

The company lowered its FY25 GAAP EPS guidance to $1.70-$2.00 from $1.80-$2.10 (vs. $1.97 est) and narrowed its sales guidance to $4.66 billion-$4.80 billion (from $4.47 billion-$4.90 billion) vs. $4.82 billion est.

The analyst writes that Floor & Decor adopted a more cautious stance after a first-quarter 2025 comp decline of -1.8% (transactions down 4%).

The second quarter comp is tracking at +1%, a sequential improvement but likely below expectations, adds the analyst.

The analyst says that Floor & Decor is well-prepared for current tariffs, having significantly shifted sourcing since 2018, reducing China exposure from 50% to 18% by 2024 while increasing US sourcing to 27%.

Their strategy involves vendor negotiation, further sourcing shifts, and price adjustments, adds the analyst.

Telsey writes that despite the disappointing guidance reduction, they remain optimistic about the company’s market position and long-term growth potential, driven by store expansion, product innovation, high-margin categories, commercial market initiatives, and Spartan Surface.

For FY25, the analyst lowered the EPS estimate to $1.90 (from $2.06; FS $1.96) with a comp of 0.1% (from 2.4%; FS 1.4%) and an operating margin of 5.6% (down ~10 bps; previously 6.0%; FS 5.7%).

For 2026, Telsey now sees an EPS estimate of $2.45 (from $2.68; FS $2.54) with a comp of 4.5% (from 5.0%; FS 4.9%) and an operating margin of 6.4% (up ~80 bps; previously 6.8%; FS 6.6%).

Price Action: FND shares gained 2.51% to $74.06 on Friday.

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This article Floor & Decor Prepared For Current Tariffs As Sourcing Shift Limits China Exposure: Analyst originally appeared on Benzinga.com

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