Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Investors were sending back shares of Express (NYSE: EXPR) after the clothing retailer said its third-quarter earnings would fall short of guidance because of a slow September. The stock was down as much as 22% in intraday trading.

So what: The company signaled that same-store sales for the quarter ending October 27 would decline by mid-single digits, and earnings would come in between $0.16 and $0.20 per share. Those figures are well below the $0.29 EPS and slightly positive comps analysts had been expecting, and the new EPS projection is just half of EPS in the same quarter a year ago. Management expressed optimism in some areas, however, saying they've "seen traffic trends improve in the final week of September" as well as "a favorable reaction to new sweater styles."

Now what: The clothing chain already left investors holding the bag once this year, when shares fell 28% after disappointing quarterly report in May as the company missed estimates on its top and bottom lines and cut guidance. Today's announcement looks like a further indicator that competition from fast fashion brands like H&M and Zara is eating into Express' core 20-something demographic. At a P/E of just 6, this stock may look like a bargain, but investors should be wary anytime they see such a steep earnings cut. Prospective buyers may want to wait for the all-important fourth quarter to determine if this stock is on the discount rack for a good reason.

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