Abercrombie & Fitch Shares Plunged: What You Need to Know
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: There was a serious situation at stylish retailer Abercrombie & Fitch (NYS: ANF) this morning when shares fell 10% after the company reported better-than-expected earnings and dissed a "pop icon."
So what: First, the important information. Revenue rose 23% in the second quarter to $916.8 million driven by international sales jumping 74%. Net income jumped 64% to $32 million, or $0.35 per share, beating estimates of $0.29. But that's just the beginning of the story.
Now what: In news I hope didn't affect the stock price negatively today, Abercrombie said it was paying Jersey Shore's Mike "The Situation" Morris to NOT wear its clothing. This might be the smartest celebrity un-endorsement ever devised. I was shocked management spent time discussing a show that makes my mind numb on its conference call.
If the drop in shares today is due to management's cautious comments, I'll buy it -- but if it's because of "The Situation," I have to rethink everything I know about investing. In either case, I think today has "buy" written all over it.
Interested in more info on Abercrombie & Fitch? Add it to your watchlist.
At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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