The Abercrombie & Fitch store prototype in Columbus, Ohio.
Abercrombie & Fitch Co. is slated to post first-quarter earnings results on Thursday — and they could be even worse than the already dire ones that analysts forecast.Wall Street's consensus estimate for the quarter pegs the retailer's net loss at 70 cents a share, on sales of $651 million. In the year-ago quarter, the company posted a loss of 59 cents a diluted share on revenues of $685.5 million.Matthew R. Boss at J.P. Morgan Chase said Tuesday the loss could be as high as 76 cents, noting that the core Abercrombie concept has had a “promotional stance” throughout the first quarter.Wolfe Research’s Adrienne Yih has an “underperform” rating on shares of Abercrombie, noting that a potential comparable-store sales upside for the Hollister concept would be offset by negative comps at the Abercrombie & Fitch brand. Her rating for the stock was due in part to “low visibility into comp turnaround given anemic traffic and deeper promos,” as well as limited historical examples of successful brand repositioning in retail.Wunderlich Securities Inc.’s Eric Beder on Monday reiterated his “sell” rating on shares of Abercrombie. “We believe the company has continued to be unable to find answers to the riddle of turning the namesake brand,” the analyst said, adding that “with no real path to recovery in the near term and what we view as somewhat futile attempts to sell itself, we see limited positives and reiterate our 'sell' rating.”Beder also said he believes the company will miss first-quarter Street expectations for a loss per share of 70 cents and a comps decline of 5 percent. The analyst said that his team’s pricing surveys indicate “an almost continuous free fall in pricing integrity at the namesake chain, as we believe the shift to older customers was misguided and has not worked."Further, Beder didn’t think that Abercrombie would be able to obtain a cash premium for selling itself due to limited cost synergies, weakness in the Abercrombie brands and a history of “disastrous specialty retail mergers.” He has a $12 price target for shares of Abercrombie.Trading in the retailer's shares were halted for about six minutes Wednesday afternoon before spiking up 6.8 percent in the early afternoon following a Wall Street Journal report that private equity firm Cerberus Capital Management was teaming with American Eagle Outfitters on a possible joint bid for the retailer. The shares ended the day’s trading session up 5.7 percent to close at $12.89. Shares of American Eagle saw a slight gain of 2.3 percent to close at $11.32.A representative for American Eagle said the retailer’s policy is to “not comment on market speculation,” while an A&F spokeswoman said the company isn’t commenting beyond a statement on May 10 acknowledging that it was in “preliminary discussions with several parties regarding a potential transaction with the company.” A spokesman for Cerberus did not return a request for comment.Les Berglass, founder, chairman and chief executive officer of executive recruitment firm Berglass + Associates, was one of the first to note private equity’s interest in retail.According to Berglass, American Eagle buying its competitor down the mall could work if it “believes that it could source goods so efficiently that it could make a profit, even if the [Abercrombie] brand remained flat.” But he also cautioned that kind of thinking “only works some of the time,” provided the sourcing and expected efficiencies are managed correctly.
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye
“It’s passion that helps get anybody to a certain point and it’s what’s propelled me,” said Kith founder @ronniefieg, one of WWD’s 40 under 40: a group of industry notables who are changing the face of retail, fashion and beauty. Fieg, who opened a Manhattan flagship on October 7, began his career at age 13 as a stock boy and salesman for footwear chain David Z. “I think staying true to [my] beliefs, hard work and passion have gotten me to where [Kith] is today.” See the rest of the 40 at WWD.com. (📷: @vsteves) #wwd40
25-year-old @samweaving is about to break out this fall, starring in Netflix’s horror film “The Babysitter,” fittingly out today on Friday the 13th. That’s not the only place you’ll be seeing her, though — Weaving’s got a role Showtime’s “SMILF” and another alongside Frances McDormand and Woody Harrelson in “Three Billboards Outside Ebbing, Missouri.” Though she’s got a full plate at the moment, there’s one role she’s got her eye on: Marilyn Monroe. “I’m a little too young at the moment, but it’s on my bucket list,” the actress told WWD (📷: @dandoperalski) #wwdeye
BFF's Poppy Jamie and Suki Waterhouse celebrated the launch of their bag line Pop x Suki at Nordstrom last night. "The line is really about our friendship, and how we are so different but complement each other," said Waterhouse. 👯 (📷: Katie Jones) #wwdeye
After designing the new @louisvuitton and @bulgariofficial flagships and a @chanelofficial boutique opening in Japan, @petermarinoarchitect has another project on his plate: The Lobster Club. Located in the Seagram Building, it’s the famed architect’s first restaurant project in New York, serving up modern Japanese brasserie-style cuisine. Bronze hues, bespoke material detailing, blush and chartreuse tones and a heavy emphasis on Picasso can be seen throughout. Mark your calendars for Nov. 1 for the much-anticipated opening. (📷: @clint_spaulding) #wwdeye