Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Women’s apparel retailer, ANN INC. (ANN - Snapshot Report) recently came up with lower-than-expected preliminary sales results for the fourth quarter of fiscal 2012. Net sales for the quarter are anticipated to be $608 million, which is below the company’s earlier forecast of $625 million and the Zacks Consensus Estimate of $612 million.

The trimmed sales projection now portrays a decline of 1% in comparable-store sales (comps), significantly down from its previously forecasted range of mid-single-digit growth. Weak sales at LOFT stores during the holiday season and Superstorm Sandy in the Northeast region negatively impacted the company’s sales. The company stated that comps at the company’s Ann Taylor brand stores inched up 1% while it declined 2% at LOFT stores.

Gross margin for the quarter is expected to expand 10 basis points (bps) on a year-over-year basis to 49.0% but will remain below the company’s earlier expectation of 51.0% primarily due to increased promotional activities during December and January.

Selling, general and administrative (SG&A) expenses for the quarter is anticipated to be $297 million, lower than the company’s previous forecast of $300 million.

However, despite ANN’s below-than-expected fourth-quarter preliminary sales results, the company is anticipating to post record earnings per share results for fiscal 2012 on the back of strong sales and improved operating margin.

Net sales for fiscal 2012 are expected to increase by 7.4% to $2.376 billion from $2.212 billion in fiscal 2011. However, net sales will remain below the company’s guidance of $2.395 billion as well as Zacks Consensus Estimate of $2.377 billion.

Gross margin for the fiscal is anticipated to come in at 54.8%, slightly below the company’s earlier expectation of 55.0%. SG&A expenses are projected to be $1.136 billion compared with the company’s prior guidance of $1.140 billion. Capital expenditure are expected to touch $155 million, lower than ANN’s forecast of $160 million.

During the fiscal, ANN repurchased 4.9 million shares for a total sum of $135 million. Of the total shares repurchased during the fiscal, 1.8 million shares were bought back during the fourth quarter at a cost of $60 million.

ANN is expected to announce its fourth-quarter and fiscal 2012 results before the markets open on Friday, Mar 8, 2013. Currently, the company holds a Zacks Rank #4 (Sell).

Other Stocks to Consider

However, not all the apparel retailer stocks are performing as poorly as ANN. Some of the company’s peers, which will announce their fourth-quarter results in near term, are expected to report better-than-expected quarterly results.

Foot Locker, Inc. (FL - Snapshot Report) has an Earnings ESP of +1.39% and carries a Zacks Rank #1 (Strong Buy).

Abercrombie & Fitch Company (ANF - Analyst Report) with an Earnings ESP of +5.18% and a Zacks Rank #2 (Buy).

Urban Outfitters Inc.(URBN - Analyst Report) with an Earnings ESP of +1.82% and a Zacks Rank #2 (Buy).

Our proven model shows that a company may beat the earnings if it has the right combination of two key components – Positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 and #3.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
LAKE SHORE G LSG 0.77 +6.05%
SKECHERS USA SKX 38.53 +4.50%
QUESTCOR PHA QCOR 80.07 +2.47%
VIPSHOP HOLD VIPS 156.35 +1.82%
ENLINK MIDS ENLC 36.29 +1.60%