3 Key Takeaways From The Children's Place's Troubled Third Quarter
The Children's Place (NASDAQ: PLCE) reported third-quarter results on Wednesday and paired the release with a weaker-than-expected holiday sales outlook. GlobalData Retail's managing director Neil Saunders published a note the same day stating that he believed that competition from Target could stymie Children's Place's attempt to relaunch its recently acquired Gymboree brand next year.
The combination of the disappointing outlook and unfavorable coverage from GlobalData Retail caused The Children's Place stock to plummet roughly 23% on Wednesday.
The company narrowly topped the market's earnings expectations despite a sales miss in the third quarter, but the bigger picture was troubling. It reported non-GAAP (adjusted) earnings per share of $3.03 on revenue of $524.8 million, topping the average analyst target by a penny, but falling short of the average sales target of $534.1 million. Net sales increased just 0.4% year over year on same-store sales growth of 0.8%, while the company had initially guided for comps growth of 3% to 4%.
Source Fool.com
