Talbot's Preview: Poised to Top Forecast

(Stock price added.)

NEW YORK (TheStreet) -- Talbots(TLB Quote), according to analysts, could be one of the few winners in the women's apparel segment when it posts its second-quarter results on Wednesday.

Market-watchers are predicting that the company's latest cost cutting, expense management and inventory controls could boost earnings per share above expectations.

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For this reason, Lazard Capital Markets analyst Todd Slater recommends buying the stock before tomorrow's earnings report.

Slater also upgraded the stock to buy. "Talbots' restructuring has been masked by the recession, but the company's moves are beginning to bear fruit," Slater wrote.

Shares of the company soared 9% to $7.20 in morning trading on the outlook.

Stifel Nicolaus analyst Richard Jaffe, on the other hand, noted that the company's same-store sales will most likely plunge 22%. "Both the troubled economic environment and Talbot's merchandise misses will be factors in the sales miss," he wrote.

Investors will be watching for news regarding the success of fall merchandise and an update on the sale of the J.Jill chain.

Analysts expect Talbots to post a loss of 52 cents a share on revenue of $309.3 million. In the second quarter last year the company recorded a loss of 22 cents per share.

Shares of the company closed on Friday up 3% to $6.61.

Last month, New York & Company(NWY Quote), Coldwater Creek(CWTR Quote) and AnnTaylor Stores(ANN Quote) all reported losses in their second quarter. The only women's retailers in the black were Chico's FAS (CHS Quote) and Charming Shoppes(CHRS Quote). -- Reported by Jeanine Poggi in New York.

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