The 10-second takeaway
For the quarter ended Oct. 27 (Q3), Wet Seal met expectations on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share dropped to a loss.
Margins dropped across the board.
Wet Seal reported revenue of $135.5 million. The six analysts polled by S&P Capital IQ wanted to see a top line of $134.3 million on the same basis. GAAP reported sales were 11% lower than the prior-year quarter's $152.1 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 -$0.11. The six earnings estimates compiled by S&P Capital IQ predicted -$0.14 per share. GAAP EPS were -$0.17 for Q3 versus $0.04 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 19.2%, 1,130 basis points worse than the prior-year quarter. Operating margin was -13.5%, 1,800 basis points worse than the prior-year quarter. Net margin was -10.9%, 1,340 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $150.9 million. On the bottom line, the average EPS estimate is -$0.03.
Next year's average estimate for revenue is $568.4 million. The average EPS estimate is -$0.22.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 197 members out of 233 rating the stock outperform, and 36 members rating it underperform. Among 60 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 47 give Wet Seal a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Wet Seal is outperform, with an average price target of $3.25.
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