Dive Brief:
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Tuesday Morning is suffering on Wall Street, which has taken the closeout retailer along its downward slide after it reported missed results late Thursday. The retailer's stock price fell more than 35% on Friday, after shares already fell more than 50% this year.
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The retailer’s prospects may be better than they look, though. CEO Michael Rouleau said that the retailer is working its way out of inventories of categories that haven’t been selling well, which led to heavy discounts.
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The retailer narrowed its Q4 net loss to $4.24 million from $7.3 million year over year. But total sales stayed at $213 million and, while same-store sales increased 3.6%, overall sales missed expectations. Some of the best-performing stores were new locations.
Dive Insight:
Wall Street showed its impatience with Tuesday Morning on Friday, but things are looking pretty ugly on Wall Street in general these days.
Still, there are plenty of retailers, including Macy's and even Wal-Mart Stores Inc., with their fair share of challenges. Certainly any retailer selling apparel is facing headwinds as consumer priorities change and spending remains an activity that shoppers do with great care and thought.
In this environment the longer term still holds a lot of potential for Tuesday Morning, though it may not seem so at the moment, Credit Suisse analyst Seth Sigman told the Dallas Morning News. It will take some patience as the retailer realizes the effects of a new marketing campaign, a move away from apparel and other poorly selling categories, and opens a new West Coast distribution center.