We're not heading to the mall the way that we used to, and the same sentiment can apply to retailer stocks. Investors have been staying away from brick-and-mortar chains and even a few e-commerce specialists.
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Chaos breeds opportunity, and earlier this week I went over a few low-priced online and offline retailers. There are more -- a lot more. Let's go over three more stocks trading in the single digits.
One of Wednesday's biggest winners was Express (NYSE: EXPR), which soared 19.5% after posting encouraging financial results. The apparel retailer's performance may not seem so impressive at first glance. Store closures and a 4% slide in comps resulted in a 5% dip in revenue for the fiscal second quarter. Express posted a marginal profit of $0.01 a share on an adjusted basis. However, analysts were holding out for a small quarterly loss on a 6% top-line decline.
The mall staple is optimistic about the second half of the year, targeting an adjusted profit per share of $0.41 to $0.48 for the entire fiscal year. Express is making healthy headway online: E-commerce sales surged 28% in its latest quarter, now accounting for nearly a fifth of the chain's revenue.
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The leading daily deals provider doesn't fit the traditional retailer mold, but Groupon's (NASDAQ: GRPN) a major seller of physical merchandise through its Groupon Goods operations. Groupon has been shifting back to its higher-margin flagship business these days, selling prepaid vouchers to help local merchants drive traffic.
Groupon's been trading in the single digits for more than three years, but it's showing signs of getting back on track. It has bowed out of unprofitable international markets, and it has come through with three consecutive quarterly profits. The appetite for discounts on local experiences isn't going away, and Groupon will continue to be the niche leader.
Shares of Francesca's (NASDAQ: FRAN) hit new all-time lows this week, seemingly another lost fashion-forward retailer discarded in the heap of fading merchants. Francesca's is holding up better than its stock chart would seem to suggest. The boutique operator remains profitable, and total sales growth has slowed but remains positive as a result of expansion offsetting negative same-store sales.
Francesca's hit new lows after disclosing that its top merchandising executive was leaving. It also announced preliminary quarterly results, with a profit of $0.20 a share exceeding its guidance despite a 3% decline in comps. The retailer did warn that the back-to-school season this month has proven challenging, with comps continuing to weaken. Francesca's is a bargain at just seven times earnings, but that's only cheap if it's able to stabilize here.
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