Brean Murray Mostly Bullish on Specialty Retail Ahead of Q1 Earnings; Gives a Thumbs Down on Abercrombie (ARO, PERY, WTSLA, NWY, ANF)

Analysts at Brean Murray have previewed Q1 earnings for a number of players in the Specialty Retail group. The firm believes that Q1 was "a period of strength for our universe, as easy comparisons, lower inventories and better looks drove traffic and bottom-line upside." Brean Murray said it remains bullish on the group over the near-term.

• Aeropostale (NYSE: ARO) - maintains Buy rating and a $45 price target. The firm argues that Aeropostale will provide "vivid reminders" as to "why it is the dominant force in the teen market." Brean Murray says shares of Aeropostale have "outstanding value and growth potential." The company will report results on Thursday May 20 after the market closes. The Street is looking for quarterly EPS of $0.46 on sales of $461.87 million.
  
• Perry Ellis (Nasdaq: PERY) - maintains Buy and $27 target. Brean Murray believes its estimates for Perry Ellis will prove conservative given "multiple upside drivers..." The firm calls Perry Ellis' FY11 "a period of sustained upside for the company." Perry Ellis will report earnings on Thursday May 20 before the market opens. The Street is looking for EPS of $0.60 on sales of $230.2 million.
  
• The Wet Seal (Nasdaq: WTSLA) - maintains Buy and $6 target. The firm sees upside to both the top- and bottom-lines as investors in Wet Seal should have a number of positives to focus on. Wet Seal will report on May 20 after the closing bell. Analysts are expecting Wet Seal to report EPS of $0.05 on sales of $138.2 million.
  
• New York & Co. (NYSE: NWY) - maintains Hold. Said plain-and-simple: "The slow turnaround at New York & Co. continues." The company will report results on the 20th before the market opens. The Street is looking for a loss of $0.08 on sales of $233.69 million.
  
• Abercrombie & Fitch (NYSE: ANF) - maintains Sell and $29 target. Brean Murray says that "even muted Street expectations for Abercrombie & Fitch remain too high, as the continued material deterioration in the domestic markets should overwhelm any international positives..." ANF will issue its quarterly numbers tomorrow morning, May 18. Analysts are expecting a loss of $0.14 on sales of $673.06 million.

Despite a volatile trading session which had stocks in the red throughout much of the day, the SPDR S&P Retail ETF (NYSE: XRT) is up about 0.2% at last check.

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