The Tilly's Bear Case Following A Q3 Beat
Shares of Tilly's Inc (NYSE: TLYS) climbed as much as 34 percent to set a new 52-week high of $13.19 following the company’s third-quarter beat, driven by strong Black Friday and Cyber Monday sales and cost cuts.
Tilly’s, a specialty retailer of casual apparel, footwear and accessories, reported third quarter EPS of $0.22, well above consensus estimate of $0.11 and above the high end of management’s guidance range of $0.07–$0.13. The company also provided fourth-quarter EPS guidance in the range of $0.15–$0.20, in line with consensus of $0.18.
“We believe that overall the company will have a good holiday selling season given its broad offering of trend-right brands,” Stifel analyst Richard Jaffe wrote in a note.
Jaffe believes the outlook is conservative given the solid third-quarter results and strong Black Friday/Cyber Monday sales.
Sidelined At Hold
The analyst, who has a Hold rating on the stock, said Tilly’s is mitigating the industry challenges with its broad assortment of branded apparel for youths and trend-right private label for men, women and kids at right prices.
However, Jaffe remains on the sidelines, saying the “current valuation already reflects a potential turnaround and the strategic initiatives put in place by the new CEO which will help drive sales and improve productivity.”
But, Jaffe raised the price target to $11 from $9.50. At last check, the stock had surged 36.58 percent on the day to $13.48 on heavy volume.
Latest Ratings for TLYS
|Dec 2016||Stifel Nicolaus||Maintains||Hold|
|Aug 2016||B. Riley||Upgrades||Neutral||Buy|
|Jan 2016||Guggenheim||Initiates Coverage on||Neutral|
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