The 10-second takeaway
For the quarter ended Jan. 28 (Q4), Wet Seal missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share contracted significantly.
Gross margins grew, operating margins shrank, net margins dropped.
Wet Seal tallied revenue of $163.2 million. The six analysts polled by S&P Capital IQ expected to see a top line of $167.3 million on the same basis. GAAP reported sales were 1.4% lower than the prior-year quarter's $165.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.03. The eight earnings estimates compiled by S&P Capital IQ predicted $0.03 per share on the same basis. GAAP EPS of $0.01 for Q4 were 80% lower than the prior-year quarter's $0.05 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 95.8%, 460 basis points better than the prior-year quarter. Operating margin was 2.9%, 260 basis points worse than the prior-year quarter. Net margin was 0.7%, 250 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $149.6 million. On the bottom line, the average EPS estimate is $0.03.
Next year's average estimate for revenue is $636.3 million. The average EPS estimate is $0.18.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Wet Seal is outperform, with an average price target of $4.30.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. 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.