rue21 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: Shares of rue21 (NAS: RUE) fell 10% briefly this morning after the company released fourth-quarter results.

So what: Revenue rose 16% to $219.9 million, and earnings per share were $0.52, slightly ahead of estimates. It was guidance that investors had their eyes on today. Management said first-quarter earnings per share would be $0.42 to $0.44 next quarter and $1.74 to $1.79 for the full year, near the bottom of analysts' expectations.

Now what: The guidance wasn't all that bad, considering it was still in line with what analysts had expected. But sales at stores open at least a year fell slightly in the fourth quarter, always a warning sign for retail investors. I wouldn't panic-sell here, but I'm also not a buyer considering the same-store sales drop.

Interested in more info on rue21? Add it to your watchlist byclicking here.

At the time thisarticle 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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