Web Sales Could Lift Ann's Shares Higher

By Trefis Team,

Shutterstock photo

Ann Inc. ( ANN ) reported strong growth in online sales in its recently released Q1'11 earnings. The leading specialty retailer of women's apparel, shoes and accessories primarily competes with firms like Aeropostale ( ARO ),  J.Crew Group (NYSE:JCG), Jones Apparel Group ( JNY ) and Limited Brands (NYSE:LTD) in the U.S. We currently have a near $31 Trefis price estimate for Ann with LOFT e-commerce and Ann Taylor e-commerce making up ~10% and ~9% of the firm's value. Our price estimate is around 15% ahead of the current market price.

Strong Double Digit Growth in Online Sales

Ann witnessed solid growth figures in its online retail channel with total web sales increasing 36% to near $58 million from $42 million in the first quarter of 2010. E-commerce sales for the Ann Taylor brand grew 47% to $29.5 million from $20 million during the last year.

We currently forecast Ann Taylor e-commerce sales to be ~$105 million in 2011. However, better than expected growth in web sales at Ann Taylor- in line with Q1 results - would mean an upside to our estimate for Ann.

E-commerce sales growth for the Loft brand was also very strong at 31.6% year over year with sales increasing to $28 million from $21.5 million in first quarter of 2010.

We currently estimate that LOFT e-commerce will reach around $110 million in 2011, though there could be upside to our $31 price estimate if sales improve ahead of our forecast.

See our full analysis of Ann

Enhanced by Zemanta

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Investing Ideas , Stocks , US Markets
Referenced Stocks: ANN , ARO , JNY

More from Trefis




Follow on:

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by BankRate.com