Shares of Foothill Ranch-based mall retailer Wet Seal Inc. jumped Friday on the company’s better-than-expected sales outlook for the current quarter.
For the three months through October, Wet Seal said it expects sales of $138 million to $142 million, versus Wall Street’s average expectation of $140.6 million.
Investors appeared to latch onto the new forecast as a sign that the retailer’s long sales slump may be easing.
Shares of Wet Seal were up more than 7% in afternoon New York trading with a market value of $345 million.
The surge came despite a lower profit forecast from Wet Seal.
It forecast a profit of $1.9 million to $4.7 million. Analysts had been expecting a profit of $5.7 million for the quarter.
The outlook came on the heels of results for the recently ended quarter that were in line with expectations.
Wet Seal earned $3.1 million for the three months through Aug. 1, down 69% from a year earlier but in line with expectations.
Sales fell 9% to $136.4 million, just ahead of the $136 million analysts were looking for.
The company runs 415 Wet Seal stores selling clothes for teen girls and 81 Arden B. clothing stores for young women.
