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Jul 31

Ugg hombre rebajas

Citing the highly promotional holiday retail environment, Francesca’s warned about the fourth quarter. It said its apparel business remained “challenged” and expected aggressive markdowns in order to clear inventory.It saw a 475 to 525 basis points decrease in gross profit margin in the fourth quarter compared to a year ago.Comparable-store-sales were expected to fall between 5% and 10% for the quarter. For the full year, comparable-store-sales were expected to fall 2% compared to the prior year.It was expected to open just one new boutique in the fourth quarter.The reason Francesca’s is a Zacks Rank #5 (Strong Sell) is because analysts have been cutting estimates.8 estimates were lowered for fiscal 2014 in the last 30 days. The 2014 Zacks Consensus Estimate has fallen to$0.79 from $0.92 in the last month. That’s an earnings decline of 24% from fiscal 2013 as the company earned $1.05 last year.

Fiscal 2015 isn’t looking much better. 9 estimates have been cut in the last 30 days.The new CEO has only been on the job just a few weeks so it will take some time to institute changes. But Francesca’s is clearly going the wrong direction.With news of the new CEO, Francesca’s shares have actually rallied off of 2-year lows.But if you think all of its problems means its a hidden gem, you’d be wrong.You’re not going to get a bargain. Francesca’s is trading with a forward P/E of 20.5 which is well above the average of the S&P 500 which is 18x.Specialty retail is tough right now. If you must buy a company in that industry, you might want to consider Deckers Outdoor Corp.which makes UGGs. It is a Zacks Rank #2 (Strong Buy) and analysts expect earnings growth of 14% this year and another 18.8% next year.It’s even trading with a cheaper valuation than Francesca’s, with a forward P/E of just 19.3.

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