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 retailer rue21
So what: Anyone expecting a positive boost from rue21's earnings report probably hasn't been paying attention lately. It's been a parade of one teen retail company after the next; both American Eagle
But while the news out of rue21 wasn't stellar, it also really wasn't that bad. Earnings per share of $0.31 missed expectations by $0.01, but sales of $172.8 million (up 21% from last year) were ahead of estimates. The company also reaffirmed its full-year guidance.
Now what: Perhaps investors were looking for some grand announcement from the company that would prove that it's somehow insulated from the industry dynamics impacting everyone else. Obviously, what was reported didn't give them that assurance. Maybe investors will be proven right, and the bad environment will catch up with rue21 in the coming quarters. As it stands right now, though, today's stock action looks like a bit of an overreaction to me.
Want to keep up to date on these stocks?