Gordmans Stores shares fall on 4Q drop in profit
Gordmans Stores reports 22 percent drop in profit, year off to a slow start and shares sink
Gordmans Stores Inc.'s shares sank Tuesday after the retailer reported that its fourth-quarter profit fell 22 percent and that the current year is off to a slow start.
THE SPARK: The Omaha, Neb., company reported late Monday that it earned $7.9 million, or 41 cents per share, for the quarter that ended Feb. 2. That compares with $10.2 million, or 53 cents per share, a year earlier. Total revenue increased 9 percent to $202.5 million.
Analysts polled by FactSet expected 37 cents per share on revenue of $202.8 million.
THE BIG PICTURE: The company warned investors in January that it was facing some difficulties and it lowered its outlook for the period, citing some unpopular merchandise and a seasonal drop in business.
President and CEO Jeff Gordman said Monday that the company was disappointed with its results and slow start to 2013. But it believes some recent changes, including its leadership team, will help drive sales gains in 2013. Gordmans named a new executive vice president and chief merchandising officer in February.
The company operates 86 stores in 18 states.
THE ANALYSIS: Stifel analyst Richard Jaffe lowered his rating on the company from "Buy" to "Hold," citing the disappointing results, the significant changes in leadership and the uncertainty regarding the impact of these changes.
SHARE ACTION: Shares sank more than 16 percent to $11.92 by midmorning Thursday.
Gordmans stock hit its annual closing low in January at $11.66 when it lowered its outlook and had been slowly recovering until the earnings report sent its price down again.
