Teen clothing retailer abercrombie and fitch Co. (ANF) on Friday said that it lost $26.7 million in the second quarter, hurt by lower sales and charges related to shutting its ill-conceived Ruehl stores brand.
The New Albany, Ohio-based company reported a second quarter net loss of $26.7 million, or 30 cents per share, compared with a profit of $77.8 million, or 87 cents per share, in the year-ago period. The latest results included $24.4 abercrombie and fitch million in special charges.
Sales fell 23% from last year to $648.5 million.
On average, Wall Street analysts expected a loss of 7 cents per share, excluding special items.
Same-store sales, perhaps the most telling metric for retailers, plunged 30% from last year. Same-store sales are considered a key indicator of a retailer’s health, since they measure the performance of stores open at least one year.
In order to combat the lower sales of its relatively-high priced merchandise amid the recession, abercrombie and fitch cut its marketing, general, and administrative costs by 19% in the quarter.
abercrombie and fitch shares rose $1.03, or +3.1%, in morning trading Friday.
The Bottom Line
We have been avoiding shares of ANF since our early June coverage began, and the stock was trading at $67.37. The company has a dividend yield of 2.12%, based on last night’s closing stock price of $32.96. The stock has technical support in the $25-$27 price area. If the shares can continue the recent run, we see overhead resistance around the $36 price level. We would remain on the sidelines for now.
abercrombie and fitch Co. (ANF) is not recommended at this time, holding a Dividend.com DARS? Rating of 3.2 out of 5 stars.
