Stifel affirms Vince Holding (NYSE: VNCE) with a Hold rating following Q2 results and outlook issued Thursday night.

Analyst Richard Jaffe noted that Vince's Q2 EPS of $0.14 compared with the firm's $0.22 estimate. Total comparable-store sales rose 13.4 percent, versus an 11.7 percent gain last year. The company also significantly lowered its FY15 adjusted EPS outlook to a range of $0.31 to $0.37.

Jaffe commented:

• Change in Product Limited until 2016 – The company recently hired Livia Lee as Senior VP of Merchandising. She has a challenging task ahead, which includes directing and inspiring designers and merchants to create product that is highly appealing and desirable by building on the successful heritage and strong brand identity of Vince. However, her major impact on product will not occur until Fall 2016. In the interim, management must play defense, limiting the negative impact of unappealing merchandise to the brand equity, protecting their relationship with their wholesale partners and their customers as well as maintaining a strong balance sheet.
• Corrective Actions to Protect the Brand – Management indicated that they are taking corrective actions to protect and enhance the Vince brand. The company plans to do so by more tightly managing its inventory as well as tighter procurement practices which will help to more carefully manage distribution in the off-price channel.

Jaffe maintains a Hold due to lack of visibility for improvement and risk inherent in turnaround execution.

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