Why Shares of New York & Company, Inc. Dropped

Is this meaningful? Or just another movement?

May 23, 2014 at 8:14PM

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 New York & Company, (NYSE:NWY) weren't looking so hot today, falling as much as 10%, and closing down 7% on a disappointing first-quarter earnings report.

So what: The fashion retailer missed slightly on both top and bottom lines, coming up with breakeven EPS on expectations of a penny per-share profit, while revenue fell 3.4% to $219.6 million, missing estimates at $223.6 million. Same-store sales dropped 2.2%, and the company closed 12 locations in the previous year as part of its real estate optimization strategy. CEO Gregory Scott noted that comparable sales improved toward the end of the quarter, and said that performance in e-commerce and in its outlet stores was solid.

Now what: Looking ahead, New York & Co. expects a slight increase in revenue for the current quarter on flat to slightly higher comparable sales, in line with Wall Street expectations of an overall revenue increase at 1.4% in the quarter. Management also guided operating income at breakeven, matching estimates, as well. Seeing as the company is in the midst of a turnaround as it's recently closed stores, I'd give management a few more quarters to see if it can drive profitability. Analysts are expecting a full-year profit of $0.16 per share, which would be a marked improvement from a year ago.

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Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

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KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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