NEW YORK (TheStreet) -- Shares of Aeropostale (ARO) are plummeting, sharply lower by 12.16% to $3.25 in pre-market trading Friday, after the teen clothing company forecast a wider than expected loss for the first quarter.

Looking ahead, Aeropostale now expects to report a loss of 53 cents to 61 cents a share for the first quarter, below the loss of 35 cents analysts are expecting.

The company said the weak outlook reflects challenging trends as it continues to see softness in consumer demand as a result of weak traffic.

For its fiscal fourth quarter, Aeropostale reported profits of a penny, breaking two straight years of losses. Analysts were expecting a loss of 3 cents for the period.

Revenue came in at $594 million which also topped analysts' estimates of $577 million.

The teen clothing company said same store sales declined 9% from a year ago, despite its efforts to cut costs in order to boost margins during the holiday shopping season. 

New York City-based Aeropostale is a mall retailer of casual apparel and accessories for teenagers and younger kids. The company operates 949 Aeropostale stores in the U.S. and Canada.

Separately, TheStreet Ratings team rates AEROPOSTALE INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:

"We rate AEROPOSTALE INC (ARO) 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, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow." You can view the full analysis from the report here: ARO Ratings Report

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