Teen Retailers Top Forecasts

Aeropostale, Hot Topic and American Eagle surpass January same-store sales estimates.
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The initial dose of January retail reports looked strong after several teen retailers posted better-than-expected sales.

Aeropostale

(ARO)

said after Wednesday's closing bell that its same-store sales rose 12.3% for the month, beating Wall Street's expectations for a 6% gain, according to Thomson First Call. The teen clothing company's total sales rose 45% to $61.6 million.

"We are very pleased with our results for the month, which reflect the continuation of the strong sales momentum we experienced during the holiday selling season," the company said. "Our inventory levels continue to be on plan and, on a per square foot basis, are slightly below last year. During the month, we made a smooth transition into our new floor set and the initial customer response to our spring merchandise assortment has been positive."

For the fourth quarter, Aeropostale's total sales increased 32% to $432.9 million, on a same-store sales increase of 10.3%. Based on its results, the retailer boosted its earnings projection for the holiday quarter to 73 or 74 cents a share from its previously expected range of 71 to 73 cents a share.

Elsewhere, the alternative-stylings chain for teens,

Hot Topic

(HOTT)

, said its same-store sales declined 0.7% in January, softer than the 5.9% fall analysts were expecting. Hot Topic, which posted disappointing results for its December selling period, stood by its previously announced earnings projection for a fourth-quarter profit of 21 cents to 24 cents a share. Shares jumped $1.12, or 7.8%, to $15.50 in after-hours trading.

American Eagle Outfitters

(AEOS)

said its January comps rose 11.3%, above Wall Street's expectations for a gain of 7.4%. Total sales rose 18% to $128.8 million.

For the fourth quarter, the teen retail chain's sales rose 23% to $2.3 billion, with a 15.5% same-store sales gain. The company reiterated its earnings guidance for the holiday quarter, calling for 70 to 72 cents a share. Analysts predict earnings of 71 cents a share.

Zumiez

(ZUMZ) - Get Report

, a clothing and accessories chain serving extreme sports enthusiasts, said its January comps rose 23.2%. Its total sales rose 46.3% to $12.9 million.

Meanwhile, women's clothing and accessories retailer

Limited Brands

(LTD)

reported that it had flat same-store sales in January. The owner of the Victoria's Secret and Express chains said net sales rose 4% to $783 million from $750.5 million.

Overall, Thomson Financial's index tracking monthly same-store sales gains projects a 4% rise for January after the bulk of retailers report their results on Thursday.

Wal-Mart

(WMT) - Get Report

, the world's largest retailer, said over the weekend it expects a same-store sales rise of 4.7% for the month. That result would hit the high-end of the retailer's previous guidance, so investors will be waiting to see if the company changes its earnings projection for the fourth quarter. Analysts expect Wal-Mart to report earnings of 83 cents a share, according to First Call.