Articles for Aeropostale

Aeropostale Reiterates Q4 Earnings Outlook, Gets a Boost as Peers Tumble

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Friday, January 6th, 2012 by Trefis Team

Aeropostale’s (NYSE:ARO) stock gained 5% on Thursday, after the disclosure of holiday sales results. Though Aeropostale reported a holiday sales decline of 5% and comp sales decline of 10% compared to previous year, the company managed to obviate the trend of its competitors issuing lower guidance by reiterating its previous Q4 earnings outlook. In comparison its major competitor American Eagle Outfitters’ (NYSE:AEO) stock crashed by 11% after it decreased its earnings outlook despite solid holiday sales. Aeropostale competes with the likes of Abercrombie & Fitch (NYSE:ANF), Gap Inc. (NYSE:GPS), Urban Outfitters (NASDAQ:URBN) in the teen apparel space.

Trefis price estimate for Aeropostale’s stock stands at $20.66, implying an upside of nearly 30% to the current market price.

Teen Apparel Retailers in 2011: Assessing the Threats & Opportunities Ahead

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Friday, January 6th, 2012 by Trefis Team

For teen apparel retailers, 2011 proved out to be a year full of nightmares. Starting with the jump in cotton prices to the economic slowdown in U.S. and Europe, different combinations of negative factors ensured that investors remain bearish on the teen apparel stocks throughout the year. Aeropostale (NYSE:ARO) was the biggest loser among these companies, losing nearly 40% of its stock value since January 2011 and was followed by Urban Outfitters (NASDAQ:URBN) and Gap Inc. (NYSE:GPS). Abercrombie & Fitch (NYSE:ANF) stood strong until November, when it got smacked after its European growth began showing signs of tapering, and finally ended the year 15% below its value in January 2011. American Eagle Outfitters (NYSE:AEO) was the only gainer among teen retailers in 2011, ending the year with a meager increase of 7%, thanks to a late surge after promising Q3 and holiday sales results.

Below we look at the major hurdles and silver lining for teen apparel retailers in 2011, and how prominently we expect each of these factors to impact teen retailers going ahead in 2012.

Apparel Companies’ Heavy Discounts Could Signal Inventory Hangover in 2012

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Wednesday, December 28th, 2011 by Trefis Team

With the holiday season nearing its end, the U.S. apparel market is seeing large discounts across the board. Be it aspirational luxury retailers such as Ann (NYSE:ANN), Jones Group (NYSE:JNY) or teen apparel retailers such as American Eagle Outfitters (NYSE:AEO), Aeropostale (NYSE:ARO), Gap Inc. (NYSE:GPS), retailers are offering huge last minute promotions. Gauging from the scale of the promotions, we believe that retailers are sitting on excess inventory that may weigh on results in the coming quarters.

The Holiday Spirit Travels Online For Teen Apparel Retailers

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Thursday, December 22nd, 2011 by Trefis Team

Online shoppers are bringing cheer to teen apparel stocks this holiday season. According to a recent report from comScore, holiday online shopping has increased by 15% this year vs. 2010. Apparel & accessories remains a high growth category in online shopping for the holidays, and we expect retailers such as Aeropostale (NYSE:ARO), American Eagle Outfitters (NYSE:AEO), Abercrombie & Fitch (NYSE:ANF), Gap Inc. (NYSE:GPS) and others to benefit from the increase in Internet sales.

Abercrombie, Gap Have the Lead on Facebook Engagement Among Teen Apparel Companies

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Wednesday, December 21st, 2011 by Trefis Team

If 2011 was all about the emergence of e-commerce and m-commerce (m for mobile) in the apparel industry, we could call 2012 the year of f-commerce for Facebook. Teen apparel companies like Abercrombie & Fitch (NYSE:ANF), American Eagle Outfitters (NYSE:ARO), Aeropostale (NYSE:ARO) and Gap Inc. (NYSE:GPS) are actively trying to engage and build brand loyalty with their target market on the site. As a proxy for these retailers online reach to customers, we take a look at some of the popular metrics below that Facebook provides such as total number of Likes and followers talking about the brand. On these metrics it looks like Abecrombie and Gap have the edge in online engagement via Facebook.

Aeropostale Worth $20 Despite Tough Retail Market

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Friday, December 16th, 2011 by Trefis Team

Teen specialty retailer Aeropostale (NYSE:ARO) showed an improvement in recent results, but the company’s struggles with negative sales comps and declining margins continue. On a brighter note, the company gained by improving its product offering in women’s business, which reflected as an improvement in women’s business comp sales from a dismal negative 18% in Q2 to negative 11% in this quarter. The improvement in women’s product mix also improved the company’s gross margins compared to Q2. Aeropostale competes with other specialty retailers such as American Eagle Outfitters (NYSE:AEO), Abercrombie & Fitch (NYSE:ANF) and Gap Inc. (NYSE:GPS) in the teen apparel space.

We have revised our price estimate of Aeropostale to $20.66, which is roughly 25% above current market price. The adjustments in our price estimate primarily reflects change in company’s current net cash/debt position along with our improved outlook for margins in 2012.

Aeropostale Q3 Preview: Margin Remain in Focus

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Tuesday, November 29th, 2011 by Trefis Team

Teen specialty retailer Aeropostale (NYSE:ARO) is scheduled to announce its Q3 earnings results on November 30th, and investors and analysts will have a keen eye on company’s gross margins. Earlier on November 3rd, Aeropostale’s stock gained over 20% after the company announced a revised earnings due to increase in expected gross margins. As gross margins are destined to take the center seat in this quarter’s earnings result, we will be watching for the trends behind the improvement in margins for Q3. Aeropostale competes with the likes of Abercrombie & Fitch (NYSE:ANF), American Eagle Outfitters (NYSE:AEO), Gap Inc. (NYSE:GPS) in the teen apparel space.

Trefis price estimate for Aeropostale’s stock stands at $18.74, implying an upside of nearly 25% to the current market price.

See our full analysis of Aeropostale

Technology’s Implications for Teen Retailers: Aeropostale, American Eagle

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Thursday, November 10th, 2011 by Trefis Team

The technology world is changing rapidly and holds large implications for how business is done in the apparel industry. Suddenly the advancements of tablets and smartphones has catapulted internet and mobile sales as the prime strategy of apparel retailers going forward. The teen apparel sector includes companies like Aeropostale (NYSE:ARO), Abercombie & Fitch (NYSE:ANF), American Eagle Outfitters (NYSE:AEO) & Gap Inc. (NYSE:GPS) is abuzz with these technical advancements in retail, as the age group 15-25 form the core of smartphone and tablet users demographically.

According to a study from IHL Group, more than 2.7 million tablet devices will be shipped for use in North American retail and hospitality by 2015, an astronomical increase of 450% over current rates. As the IHL Group president Greg Buzek sums up “A complete transformation of the customer experience will occur at clothing and department stores over the next three years.” Below we look at how the apparel sector is getting influenced by technical advancements.

See our full analysis for Aeropostale | Abercrombie | American Eagle | Gap

Aeropostale’s Shares Fly on Improved Margin Outlook, Tops Out at $18.75

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Friday, November 4th, 2011 by Trefis Team

American teen apparel retailer Aeropostale’s (NYSE:ARO) stock gained roughly 20% yesterday after the company announced that it is looking forward to better than expected gross margins for the third quarter. Additionally the company also increased its earning guidance for the quarter and the effect echoed through its stock yesterday with ARO touching $17.5 mark for the first time since August. Its competitor Abercrombie & Fitch’s (NYSE:ANF) stock crashed yesterday by nearly 20% on disappointing international sales, which is a welcomed change as the past couple of quarters Aeropostale has underperformed Abercrombie and other peers like American Eagle Outfitters (NYSE:AEO) and Gap Inc. (NYSE:GPS) in the teen apparel space.

See our full analysis of Aeropostale

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Aeropostale Faces Lawsuits Over Mgmt’s Disclosures

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Thursday, October 20th, 2011 by Trefis Team

Value based specialty retailer Aeropostale (NYSE:ARO) finds itself caught in legal issues after several law firms slapped lawsuits against the company alleging the management of misleading shareholders regarding its business and prospects. The major point of contention of the law firms is that Aeropostale violated federal securities laws by not disclosing that it was experiencing declining demand for its women’s fashion division, which is core to its business and that due to increasing inventory and higher clothing discounts the company was enduring pressure on its profit margins. We believe that the lawsuits if has merit, this can damage Aeropostale’s reputation and start a fresh row of trouble for the struggling teen apparel retailer. Aeropostale competes with other specialty retailers like American Eagle Outfitters (NYSE:AEO), Abercombie & Fitch (NYSE:ANF) and Gap Inc. (NYSE:GPS) in the teen apparel space.

See our full analysis of Aeropostale