NEW YORK (
stock is spiking, despite forecasting a weak year ahead.
Shares of the premium denim maker are surging 17.9% to $24.82, after True Religion reported an 8% jump in profit to $15.8 million, or 63 cents a share, compared with $14.6 million, or 59 cents, last year.
Sales rose 19.5% to $110.9 million.
Analysts were calling for a profit of 61 cents a share on revenue of $103.4 million.
True Religion issued full-year guidance of $1.80 a share, missing Wall Street's estimates of $2.02.
"We believe the 2011 earnings guidance ... reflects True Religion management's decision to sacrifice near-term upside by investing in long-term growth opportunities, including international expansion, strategic hires and planned reduction in sales to its off-price discount channel," Brean Murray analyst, Eric Beder, wrote in a note. "While we expect 2011 to be a year of infrastructure changes and investment over material earnings growth, we believe that the company will be well positioned to drive expansion both domestically and internationally over the long term."
Beder maintains his buy rating and $28 price target on the stock.
--Written by Jeanine Poggi in New York.
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