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What: Shares of specialty retailer Francesca's (NASDAQ:FRAN) fell on Wednesday after the company came up short of analyst estimates when it reported first-quarter earnings. At noon, the stock was down about 12%, partially recovering from a 17% decline Wednesday morning.

So what: Francesca's reported quarterly revenue of $95 million, up 11.2% year-over-year, but just barely missing the average analyst estimate. This growth was driven solely by new store openings, with the company opening 76 new stores over the past year, with 50 new stores opened during the first quarter alone. The company's total store count now sits at 589.

Comparable-store sales declined by 2% during the quarter, although direct-to-consumer sales jumped by 19%. The number of comparable transactions declined by 5% during the quarter, with the average transaction value rising by 3%. Francesca's has managed to report positive comparable-store sales growth in only two of the past nine quarters.

Francesca's reported EPS of $0.17, down from $0.20 during the first quarter of 2014 and a penny short of analyst expectations. Gross margin fell during the quarter while SG&A expenses rose as a percentage of revenue, leading to an operating margin of 12.5%, down from 16.4% during the first quarter of 2014.

The company expects a mid-to-low single-digit decrease in comparable-store sales during the second quarter, and it expects to open 20 new stores. EPS for the full year is expected to be between $0.81 and $0.90, an increase compared to 2014 but well below peak earnings of $1.05 per share in 2012.

Now what: With comparable-store sales declining amid a fairly rapid expansion, it's no wonder that profitability is suffering. Francesca's stock has plummeted since the company went public back in 2011, peaking around $35 per share in late 2012 only to fall to around $14 per share today. Even at the current price, the stock doesn't appear cheap, trading at nearly 16 times the high end of the company's earnings guidance.

It's unclear how strong Francesca's growth story really is, given that existing stores are performing poorly as the company expands, and for that reason, I'm happy to sit this one out.