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Bebe falls, 1Q outlook below Street's view

NEW YORK (AP) -- Shares of Bebe Stores fell Friday as the women's clothing company provided a first-quarter earnings outlook below analysts' estimates. Its fourth-quarter results beat Wall Street's view.

Bebe Stores Inc. said late Thursday that it expects a first-quarter loss of 1 cent to 4 cents per share. Revenue at stores open at least a year, a key gauge of a retailer's health, is anticipated to be down in the mid- to high- single digital percentage range.

Revenue at stores open at least a year excludes results from stores recently opened or closed.

Analysts polled by FactSet predict first-quarter earnings of 4 cents per share.

Bebe also reported fiscal fourth-quarter earnings of 4 cents per share on revenue of $131.5 million.

Wall Street expected earnings of 3 cents per share on revenue of $128.4 million.

For the fourth quarter, revenue at stores open at least a year declined 2.5 percent.

Betty Chen of Wedbush said in a client note that she is pleased that Bebe has pulled back on its promotional activity, but that the move may pressure the retailer's revenue results going forward, as traffic was down in the fourth quarter.

Adrienne Tennant of Janney Capital Markets says she believes Bebe's sales will continue be pressured near term by difficult economic conditions and tough competition.

The analyst also feels that the recent resignation of President Emilia Fabricant may hurt the retailer, saying that Fabricant's merchandising and retail experience could have helped the business over time.

Fabricant's resignation was announced last week. Bebe said that Fabricant's duties will be taken over by Chairman and CEO Manny Mashouf and Renee Bell, the company's head of merchandising.

Both Chen and Tennant lowered their price targets to $5.50 from $6 and kept "Neutral" ratings for the company.

Bebe's stock dropped 7 cents to $5.39 in midday trading. The stock is down 35 percent in the year to date.