Ascena Retail (ASNA) Stock Falls Today on Weak Second Quarter Earnings
NEW YORK (TheStreet) -- Ascena Retail Group (ASNA) - Get Report shares are down 0.83% to $13.12 in trading on Wednesday following the release of the specialty clothing retailer's second quarter earnings results after the closing bell yesterday.
The Justice, Lane Bryant, and Dress Barn chains parent company reported second quarter net income of $8.7 million, or 7 cents per diluted share on an adjusted basis. The company also generated $1.29 billion in revenue during the period, a 1.7% increase from the $1.26 billion in revenue it generated during the same period last year.
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Analysts on average were expecting the company to report quarterly earnings of 8 cents per share on revenue of $1.3 billion.
The company's gross profit remained flat from last year's second quarter at $662 million while its gross margin dropped 90 basis points to 52.3% thanks in large part to higher markdowns at the company's Justice stores.
The company also reiterated its fiscal 2015 outlook forecasting full year earnings between 70 cents and 75 cents per diluted share, with capital expenditures expected to range between $325 million and $350 million.
TheStreet Ratings team rates ASCENA RETAIL GROUP INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate ASCENA RETAIL GROUP INC (ASNA) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and feeble growth in the company's earnings per share."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- You can view the full analysis from the report here: ASNA Ratings Report
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