The 10-second takeaway
For the quarter ended April 28 (Q1), rue21 missed estimates on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share improved significantly.
Gross margins dropped, operating margins shrank, and net margins were steady.
rue21 booked revenue of $205.6 million. The six analysts polled by S&P Capital IQ predicted sales of $210.0 million on the same basis. GAAP reported sales were 19% higher than the prior-year quarter's $172.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.46. The six earnings estimates compiled by S&P Capital IQ predicted $0.45 per share. GAAP EPS of $0.46 for Q1 were 21% higher than the prior-year quarter's $0.38 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 38.8%, 10 basis points worse than the prior-year quarter. Operating margin was 8.9%, 30 basis points worse than the prior-year quarter. Net margin was 5.6%, about the same as the prior-year quarter.
Next quarter's average estimate for revenue is $207.8 million. On the bottom line, the average EPS estimate is $0.34.
Next year's average estimate for revenue is $923.7 million. The average EPS estimate is $1.80.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 45 members out of 60 rating the stock outperform, and 15 members rating it underperform. Among 13 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 11 give rue21 a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on rue21 is outperform, with an average price target of $31.63.
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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.