It's that time again, and it seems to happen every quarter. That time is time to wonder if Talbots
Unfortunately, though, Talbots' third-quarter profits weren't exactly exciting. Net income came in 21% lower at $27.6 million, or $0.50 per share. (The quarter included a $4.4 million -- or $0.08 per share -- tax benefit, to boot.) Sales increased a scant 3% to $421.2 million. Same-store sales were flat, and catalog sales decreased by 6%.
This might sound like deja vu, but today Talbots met guidance that it had already ratcheted down in September. (In case your memory needs refreshing, last quarter Talbots did manage to eke out a 5% increase in earnings, but it was also meeting already lowered guidance.)
Poor Talbots. After all, Chico's
(Anyone who's wondering about Gap's
Last quarter, Talbots waxed enthusiastic about regular-price selling. This quarter, though, the view was murky, with the company saying that September saw regular-price selling drag (the result of, ahem, hurricanes and a later Labor Day), but October showed "dramatic improvement" in such trends.
Today's earnings news from Talbots doesn't seem to show any dramatic change from the quarters that have gone before. This still appears to be a company that is struggling to appeal to its own audience.
Unfortunately, those who bought Talbots shares back in July have watched the going price shrink by 27%. Meanwhile, the company's current forward P/E ratio of 17 doesn't look so cheap, considering the continued uncertainty, and the fact is that investors who gamble here face the risk that Talbots still won't get it quite right.
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Alyce Lomax does not own shares of any of the companies mentioned.