NEW YORK (TheStreet) -- Shares of Express Inc. (EXPR) - Get Report are higher by 2.62% to $14.49 in mid-afternoon trading on Monday, after the apparel and accessories retailer issued updated guidance for the 2014 fourth quarter and full year, and is now expecting earnings to come in higher than previously expected.
As a result of the company's performance during the 2014 holiday season, 2014 fourth quarter earnings are expected to be between 43 cents and 46 cents per diluted share, compared to Express' original forecast of 38 cents to 45 cents per diluted share for the period.
For the 2014 full year Express now believes that its earnings will range from 74 cents to 77 cents per diluted share versus its previous guidance of 69 cents to 76 cents per diluted share.
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Comparable sales for the 2014 fourth quarter are expected to decline 3% to 4% compared to the mid to high single digit decline Express had anticipated. The company is expecting comparable sales for the year to decline in the mid-single digit range, compared to the mid to high single digit range Express had guided for earlier.
Separately, TheStreet Ratings team rates EXPRESS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate EXPRESS INC (EXPR) 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 reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The current debt-to-equity ratio, 0.39, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.72 is somewhat weak and could be cause for future problems.
- 35.46% is the gross profit margin for EXPRESS INC which we consider to be strong. Regardless of EXPR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.93% trails the industry average.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Specialty Retail industry and the overall market, EXPRESS INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- Net operating cash flow has significantly decreased to -$6.80 million or 714.09% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full analysis from the report here: EXPR Ratings Report