Share of American Eagle Outfitters fell more than 13 percent Wednesday morning on news of a lower-than-expected quarterly rise in same-store sales.
Making matters worse, the teen denim and apparel retailer forecasted fourth-quarter profits well below estimates, revealing it now expects earnings per share in the range of 35-37 cents. Analysts were expecting EPS of 45 cents.
The company’s same-store sales rose 2 percent in the quarter ending Oct. 29, but that wasn’t enough for analysts, who had anticipated a 2.9 percent rise.
Nearly all of this growth was driven by AEO’s Aerie brand of lingerie, where sales surged 21 percent. Comparables at its namesake American Eagle brand, however, barely moved, up just 0.4% for the quarter.
Net revenue increased 2 percent, up to $941 million from $919 million last year. Profit came in on target at 41 cents per share to $75.8 million, up from 38 cents and $74.1 million last year.