Shares of Perry Ellis (NASDAQ:PERY) tumbled 23% to nearly a two-year low on Wednesday after the designer cut its outlook below Wall Street expectations.
Weak shipments, particularly in its private label business, as well as softer-than-expected sales through its direct retail channel, weighed on Perry Ellis during the third quarter and are expected to continue to impact sales through the rest of the year.
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The Miami apparel company predicted a loss for the third quarter ending Nov. 2 of between 15 cents and 17 cents a share, which would fall short of last year’s 25-cent profit and would be well below the consensus view of a 13-cent profit.
Perry Ellis also lowered its fiscal 2014 guidance, now predicting revenues in the range of $960 million to $970 million, below its earlier view of $985 million to $995 million and missing the Street's view of $989.4 million.
Full-year adjusted earnings are expected to be in the range of 95 cents to $1.01 a share, below its earlier view of $1.50 to $1.60. Analysts on average are calling for EPS of $1.50.
The earnings were met with a wave of disappointment on Wall Street, with its shares plummeting 23% to $14.95 in recent trade.
A bright spot, notes Perry Ellis, is that its golf lifestyle apparel and Nike swim business continued to perform in line with expectations.