NEW YORK (TheStreet) -- Tilly's (TLYS) plunged to a one-year low of $7.96 on Thursday after the company reported lower-than-expected first-quarter earnings and issued guidance that missed analysts' expectations.
Tilly's reported earnings of 2 cents a share, in line with analysts' estimates. The company reported revenue of $111.1 million, which came up short of expectations of $113.22 million. Comparable-store sales declined 6.8% in the quarter.
The company issued second-quarter earnings guidance of 3 cents to 7 cents a share, while analysts expected 13 cents a share. Finally, Tilly's expects second-quarter comparable-store sales to decline in the high single digits.
Must Read: Warren Buffett's 25 Favorite StocksSTOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. The stock was down 15.6% to $8.93 at 2:27 p.m. Separately, TheStreet Ratings team rates TILLY'S INC as a "sell" with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation: "We rate TILLY'S INC (TLYS) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has significantly decreased by 45.0% when compared to the same quarter one year ago, falling from $9.84 million to $5.42 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Specialty Retail industry and the overall market, TILLY'S INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The gross profit margin for TILLY'S INC is currently lower than what is desirable, coming in at 34.77%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.87% trails that of the industry average.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 36.08%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 45.71% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- TILLY'S INC's earnings per share declined by 45.7% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, TILLY'S INC reported lower earnings of $0.64 versus $0.85 in the prior year. This year, the market expects an improvement in earnings ($0.65 versus $0.64).
- You can view the full analysis from the report here: TLYS Ratings Report
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV