Wednesday, May 28, 2008

Upcoming Wet Seal Earnings

Wet Seal (WTSLA) is going to release its earnings numbers tomorrow afternoon. Not sure why this time around the call is happening after the bell, because they have typically done it before the market open. In any case, I'm not too worried about the quarter's numbers given that the company pre-announced just a few weeks ago better than expected earnings (estimating 0.07-0.08 EPS on roughly $142MM in revenue).

I am very interested to hear what the management team has to say about their Arden B division. The new look for Arden B is highly anticipated, and the full rollout should be happening soon... next week, I believe. It's nice to know that the flagship Wet Seal stores are doing just fine, if not great. Only recently has the company broken down their numbers for its two divisions separately. Today's stock price move was very much welcome by me, but as always, anything can happen during an earnings call.

Much of today's stock move was probably driven by analyst comments. Brean Murray came out saying that it believed that the company was making material progress with its business model. Based on their research note, they continue to believe that material upside opportunities remain the Wet Seal management further improves the business model and drives solid returns. And, while they expect to see some costs incurred due to the clearing out of unpopular merchandise at Arden B, they are expecting a strong showing by the Wet Seal division. They sum it up saying that they believe that the cash balances will remain healthy, and they continue to find attractive the risk/reward of WTSLA shares.

I also heard that Merriman Curhan Ford came out with a reiteration of their Buy rating, but I am unsure of the reliability of the source.

Anyway, that's all for now. But, I will leave you with this outfit that can be yours for only $79.99.


gaamblor said...

god damn you must be in a good mood today

Brute Force said...

Oh hell, yes! Lovely day for the portfolio.