Nomura Securities Maintains a 'Neutral' on rue21, inc. (RUE); Q2 Results Review

Nomura Securities maintains a 'Neutral' on rue21, inc. (NASDAQ: RUE), price target lowere from $34 to $30.

Nomura analyst, Paul Lejuez, said, "2Q results were not as bad as it appears on the surface. Comps and EPS were somewhat disappointing, but GM improved on better full-priced selling and no costing pressures. Top line was hurt by lack of Summer clearance during the heat wave in July, but back-to-school seems to be off to a good start. We are revising our F11E EPS to $1.51 from $1.59 based on lower-than expected sales, and reducing our TP to $30, which represents 6.8x our F12 EBITDA vs. the group at 6.1x (we view a slight premium multiple as reasonable for this teen growth story). The risk/reward seems balanced at current levels."

For more ratings news on rue21, inc. click here and for the rating history of rue21, inc. click here.

Shares of rue21, inc. closed at $26.97 yesterday.

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