Shares of Foothill Ranch-based Wet Seal Inc. surged last week as the company reported quarterly results that beat estimates and investors looked past a more cautious outlook for the current quarter.
The retailer’s stock rose about 10% on a market value of about $275 million.
Wet Seal swung to a profit of $12.2 million for the three months ended Feb. 2, versus a loss of $5.7 million a year earlier.
Wall Street was looking for a profit of $9.4 million.
Sales for the quarter were up 8% to $179.6 million, beating analysts’ expectations of $174 million.
Wet Seal runs about 495 mall stores selling clothes for teen girls and young women.
For the current quarter through April, Wet Seal expects a profit of $3.7 million to $5.6 million, below the $7.5 million Wall Street had been expecting.
The company projects quarterly sales at stores open at least a year to drop 7% to 9%.
Wet Seal sees its smaller Arden B. chain for young women hurting results for the current quarter.
The company blames “current inventory mix issues”,retail speak for not having enough in-demand clothes on hand.
In February, same-store sales fell 24% at Arden B. The company’s namesake Wet Seal chain saw a 3.6% decline.
