Shares of Anaheim-based retailer Pacific Sunwear of California Inc. were up near the close of New York trading Friday, reversing an afterhours tumble on a mixed outlook.
The stock fell in Thursday afterhours trading after Pacific Sunwear forecast a wider than expected loss for the current quarter but upped its outlook for the 12 months through January.
Wall Street seemed to put the mixed message behind it Friday, focusing on the company’s plans to reverse course by closing its struggling demo chain selling urban style clothes and focusing on its dominant PacSun stores selling surf-inspired clothes.
The shares were up as much as 4% in early Friday trading before pulling back with the broader market to about a 1% gain near the close. The company has a market value of $830 million.
“We believe PacSun division is on the right track with improving apparel, strong inventory control, and improving merchandise,” said Citi Investment Research analyst Kimberly Greenberger, according to an Associated Press report.
Other analysts still are worried about profits at Pacific Sunwear.
The company projected a loss of $4.2 million to $5.6 million for the three months through May 3. Wall Street on average had been expecting a loss of $1.4 million.
Pacific Sunwear is more upbeat for the 12 months through January. It said it sees a yearly profit from continuing operations of $51 million to $54 million. Analysts on average had been expecting a profit of $35 million.
The forecasts came after Pacific Sunwear reported results for the three months ended Feb. 2 that beat expectations.
Excluding the demo chain, Pacific Sunwear earned $21.7 million. Wall Street had expected $21 million.
Revenue fell 8% from a year earlier to $420.1 million but beat estimates of $389 million.
Same-store sales, or sales at stores open at least a year, slipped 2.2% for the quarter, largely on slower sales of shoes.
For 12 months through January, the company sees same-store sales growing 3% to 4%.
