NEW YORK (
Abercrombie & Fitch's
(ANF - Get Report)
monthly sales have been slowly (and we're talking snail-like here) improving. But will those baby steps be enough to lift the teen retailer in the third quarter?
This week at least two analysts' seemed to think so, as both Goldman Sachs and Credit Suisse upgraded the company to the equivalent of a buy rating, citing strong international sales and lower prices.
Recently, Abercrombie opened a flagship in Milan and plans to open one in Tokyo by the end of the year. It also plans to roll out 10 additional international mall-based stores this year.
Same-store sales, however, still remain deep in negative territory, as Abercrombie reported a 15% plunge in October, in-line with analysts' estimates.
And while Stifel Nicolaus analyst Richard Jaffe says he sees merchandise improving, he cautions that there isn't enough fashion-forward merchandise to woo shoppers.
In addition, Abercrombie remains especially constrained as rival
(ARO - Get Report)
continues to outperform the sector.
In the third quarter, Wall Street expects Aberccrombie to earn 20 cents a share on revenue of $764.5 million. That's 72% below last year's EPS of 72 cents a share and 15% lower than last year's revenue of $896.3 million.
Investors, meanwhile, will be waiting to get word on how holiday merchandise is selling so far and what promotions are planned for the season.
-- Reported by Jeanine Poggi in New York
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