Interesting. To hit the revenue estimate for the quarter, aro needs to grow October sales 11.5% from last year. They grew overall sales 4% in August and 9% in September. Last October they grew sales 9%. SSS was up 3% in 2009. That makes the sss comps easier than earlier this year, I think.
The high estimate I think skews the average up. I don't think that analyst has ben following closely or just didn't change their estimate, or yahoo thompson didn't pick it up.
The low estimate also seems a bit of a lowball.
It's acting like people don't expect a great sss release thursday (I think it's thursday), and sales may be goosed by some discounting. Then again, I don't think price action necessarily reflects much other than short termism and active pushing. This has been a most telegraphed reversion trade. It's been a couple of years this comes up, the stock goes down, short interest shrinks, it goes back up, then pushed back down again.
SSS momentum sems to dictate a lot of short term moves nore than the overall value.
Yes, a lot of down grades in late october and early November 2008 as it went from low teens to $9 (adjusted), but the company actually was doing great despite the credit crash and folks could triple or even quadruple their money from those lows, and even more than 2x from where the first downgrade was issued.
And in early 2010, january, 3 downgrades, and you could then ride from low 20s to low to mid 30s.
I think sometimes that is just bad calls and sometimes it is intentional.
This is what I meant by the sss reversion being incredibly telegraphed. This is about the 3rd wave of such calls since late 2008. I think it is pair traded with ANF, AEO, etc., with analysts just playing the tough comps/easy comps short term momentum.