The Wet Seal, Inc. Earnings: Exceeds Forecasts with Boost of Profit Rise

The Wet Seal, Inc. (NASDAQ:WTSLA) reported net income above Wall Street’s expectations for the second quarter. Wet Seal, Inc. is a national retailer operating stores selling fashionable and contemporary apparel and accessory items designed for female customers aged 13 to 35 years old.

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The Wet Seal Earnings Cheat Sheet for the Second Quarter

Results: Net income for The Wet Seal, Inc. rose to $2.2 million (2 cents per share) vs. $1.6 million (2 cents per share) in the same quarter a year earlier. This marks a rise of 36.2% from the year earlier quarter.

Revenue: Rose 13.1% to $148.8 million from the year earlier quarter.

Actual vs. Wall St. Expectations: WTSLA reported adjusted net income of 3 cents per share. By that measure, the company beat the mean estimate of 2 cents per share. Analysts were expecting revenue of $146.9 million.

Quoting Management: Ms. Susan McGalla, chief executive officer of The Wet Seal, Inc., commented, “We were pleased with continued momentum in our business through the second quarter as we entered the back-to-school selling season. We generated our strongest second quarter comparable store sales results since 2005, reflecting continued strength and balance in our merchandise assortments, a clarified message of unique fashion at a value in our Wet Seal stores, and a strengthening of the business trend in our Arden B stores. “We also ended the second quarter comfortable with the level and overall content of our inventories.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 13.3% to $156 million in the first quarter. The figure rose 9.6% in the fourth quarter of the last fiscal year from the year earlier and climbed 3.4% in the third quarter of the last fiscal year from the year-ago quarter.

The company beat estimates last quarter after being in line with expectations in the first quarter with net income of 8 cents per share.

The company has now been profitable for the last nine quarters, and for the last five, profit has risen year over year by an average of 1.3%. The quarter with the biggest boost was the first, which saw a more than twofold surge.

Competitors to Watch: Body Central Acquisition Corp. (NASDAQ:BODY), bebe stores, inc. (NASDAQ:BEBE), dELiA*s, Inc. (NASDAQ:DLIA), Limited Brands, Inc. (NYSE:LTD), The Cato Corporation (NYSE:CATO), Aeropostale, Inc. (NYSE:ARO), The Buckle, Inc. (NYSE:BKE), Abercrombie & Fitch Co. (NYSE:ANF), Pacific Sunwear of California, Inc. (NASDAQ:PSUN), and Zumiez Inc. (NASDAQ:ZUMZ).

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(Source: Xignite Financials)