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: Shares of teen-oriented apparel retailer Aeropostale Inc (AROPQ) plummeted 22% today after its quarterly results and outlook disappointed Wall Street.
So what: The stock has plunged over the past year on rapidly declining fundamentals, and today's Q4 results -- loss of $76.8 million on a revenue decline of 12% -- coupled with downbeat guidance only reinforce that trend. In fact, same-store sales during the quarter fell a whopping 13%, versus Wall Street's expectation of just a 9% drop, suggesting that Aeropostale's brand continues to weaken at a surprisingly brisk pace.
Now what: Management now sees a Q1 loss of $0.55 to $0.61 per share, worse than the consensus per-share loss of $0.50. "[A]t the close of the quarter, we took additional actions to build on our turnaround efforts from the past year, restructuring our P.S. from Aeropostale business and expanding our expense savings program," said CEO Thomas Johnson. "We remain focused on strengthening our company operationally and financially as we continue to implement our strategies to reposition the Aeropostale brand." Of course, given the extremely low visibility into how management actually plans to right the ship, Fools would probably be better off watching from the sidelines.
