Needham & Company Reiterates a 'Buy' on Aeropostale (ARO); Contrarian Value Investors After F3Q Outlook Significantly Disappoints
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Price: $0.15 --0%
Rating Summary:
5 Buy, 25 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
5 Buy, 25 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Needham & Company reiterates a 'Buy' on Aeropostale, Inc. (NYSE: ARO), price target lowered from $24 to $15.
Needham analyst says, "We believe that near term margin pressures from a highly competitive teen space and sourcing costs increases have led to a worst-case scenario earnings outlook for FY11 as expectations are lowered once again. At ~10x our reduced FY12 EPS estimate of $1.12 (9x x-$1.68 a share in cash), 0.4x P/Sales, and 2.1 EV/EBITDA, ARO is trading at significant discount to the sector averages of 12x, 0.8x, and 5.7x, respectively, which we believes already discounts a worst-case scenario and lowered expectations. Thus, we believe ARO is an attractive opportunity for value oriented investors as applying a 13x multiple (the mid point of its 11% to 15% growth rate) on what we think is worst case scenario for FY12 results."
"We are lowering our F3Q, F4Q, and FY11 EPS estimates to 0.09, $0.34, & $0.61, respectively, down from 0.35, $0.76, & $1.34...We are reducing our F1Q, F2Q, F3Q, F4Q, and FY12 EPS estimates to $0.24, $0.08, $0.24, $0.56, and $1.12, respectively, down from $0.25, $0.10, $0.54, $0.95, and $1.84."
For more ratings news on Aeropostale, Inc. click here and for the rating history of Aeropostale, Inc. click here.
Shares of Aeropostale, Inc. closed at $12.49 yesterday.
Needham analyst says, "We believe that near term margin pressures from a highly competitive teen space and sourcing costs increases have led to a worst-case scenario earnings outlook for FY11 as expectations are lowered once again. At ~10x our reduced FY12 EPS estimate of $1.12 (9x x-$1.68 a share in cash), 0.4x P/Sales, and 2.1 EV/EBITDA, ARO is trading at significant discount to the sector averages of 12x, 0.8x, and 5.7x, respectively, which we believes already discounts a worst-case scenario and lowered expectations. Thus, we believe ARO is an attractive opportunity for value oriented investors as applying a 13x multiple (the mid point of its 11% to 15% growth rate) on what we think is worst case scenario for FY12 results."
"We are lowering our F3Q, F4Q, and FY11 EPS estimates to 0.09, $0.34, & $0.61, respectively, down from 0.35, $0.76, & $1.34...We are reducing our F1Q, F2Q, F3Q, F4Q, and FY12 EPS estimates to $0.24, $0.08, $0.24, $0.56, and $1.12, respectively, down from $0.25, $0.10, $0.54, $0.95, and $1.84."
For more ratings news on Aeropostale, Inc. click here and for the rating history of Aeropostale, Inc. click here.
Shares of Aeropostale, Inc. closed at $12.49 yesterday.
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