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What: Shares of teen apparel retailer Abercrombie & Fitch Co. (NYSE:ANF) popped 11% today after its fourth-quarter update and outlook impressed investors.
So what: The stock has slumped in recent months on concerns over plummeting sales, but today's Q4 update -- same-store sales are down just 6% so far -- coupled with upbeat guidance suggests that things are stabilizing. Management cited successful cost-cutting initiatives and better-than-expected demand for the positive report, giving analysts plenty of good vibes over Abercrombie's turnaround prospects.
Now what: Management now sees full-year adjusted EPS of $1.55-$1.65, up from its prior prediction of $1.40-$1.50. "[F]all season carryover inventory levels are well controlled as we move into the new season," said Chairman and CEO Mike Jeffries. "We continue to focus on execution against our long-term strategic plans, which we believe will drive meaningful improvements in our business in 2014 and beyond." With the stock still off more than 30% from its 52-week highs and sporting a 2%-plus dividend yield, buying into that turnaround talk might even be worth considering.
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