Children's Place Shares Popped: 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: Shares of children's apparel retailer The Children's Place (NAS: PLCE) trampolined up as much as 18% today after the company announced third-quarter results.
So what: For the quarter, Children's Place's total sales climbed 7% from a year ago. The gain was thanks to 81 net new store openings since last year and a 0.9% gain in comparable-store sales. Expanding margins helped the bottom line grow even faster as earnings per share jumped from $1.14 to $1.33.
Both sales and profit topped Wall Street's estimates, which called for $1.27 in per-share profit on $469 million in sales.
Now what: As if that wasn't enough, the company also bumped up its full-year profit outlook to a range of $3.24 to $3.29, up from a range of $3.13 to $3.25. Analysts had been expecting $3.22 per share for the year. Driving the better-than-expected performance is higher profitability as gross margins have expanded through higher markups, "lower markdowns, and disciplined inventory management."
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