Dallas, Texas 06/29/2015 (Financialstrend) – Pacific Sunwear of California, Inc. (NASDAQ:PSUN) prospects have turned sour in the street in the wake of the company failing to meet Wall Street estimates for the first quarter. A dismal outlook for the second quarter has since dampened the stock’ prospects having already registered a 52 week low.
Same Store Sales Concerns
After two consecutive quarters of earnings beat things have turned for the worst seen by same-store sales plunging by 2% for the quarter ended May 2. The plunge in sales was attributed to the unrest in the West Coast as well as unfavorable weather conditions. A net loss of $3.5 million for the quarter did not go well with the street, which has since seen the stock resort to the downward trend.
The company expects to generate a net loss of between 1 cent and 5 cents a share for the current quarter just an indication that things are not improving. Pacific Sunwear of California, Inc. (NASDAQ:PSUN)’s same-store sales for the second quarter could drop by 4% according to shared estimates, on revenues of between $201 million and $209 million.
Shorts and non-apparel products continue to underperform which Pacific Sunwear of California, Inc. (NASDAQ:PSUN) expects to affect the July quarter. However, there could be an improvement on the merchandise margins front. Pacific Sunwear of California, Inc. (NASDAQ:PSUN) plans to get back to positive comp store sales on the improvement of several brand initiatives coupled with growth in long bottoms.
Mixed Analysts Sentiments
Concerns over Pacific Sunwear of California, Inc. (NASDAQ:PSUN)’s sales have resulted in mixed reaction over the stock’s long-term prospects. The stock is currently rated as a ‘buy ‘by one research firm while 5 Wall Street analysts maintain a hold rating. Brokerage firm Mizuho Securities has already downgraded the stock to a Neutral having reiterated a buy rating previously.