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Ahead of the Bell: Aeropostale's strong sales

Analysts said Friday that Aeropostale Inc. is off to a strong back-to-school season, after the teen apparel retailer posted a higher second-quarter profit on strong same-store sales growth.
/ Source: The Associated Press

Analysts said Friday that Aeropostale Inc. is off to a strong back-to-school season, after the teen apparel retailer posted a higher second-quarter profit on strong same-store sales growth.

After Thursday's closing bell, Aeropostale posted a $38.6 million profit — up from $21.1 million a year ago.

Revenue rose 20 percent, helped by a 12 percent rise in same-store sales. Same-store sales, or sales at stores open at least a year, are an important retail performance indicator because they measure sales at existing locations rather than newly opened ones.

BMO Capital Markets analyst John Morris, who rates the stock "Outperform," called Aeropostale a "winner" during the back-to-school season because of merchandise and value.

"We believe the third quarter is off to a good start to fall, with management noting positive reads on initial back-to-school assortments," Morris wrote in a client note.

Meanwhile, SunTrust Robinson Humphrey analyst Robin Murchison said the company's back-to-school denim line has performed well, with its darker colors and destroyed denim look.

Also, Aeropostale logo merchandise remains extremely popular, said Murchison, who rates the stock "Buy."

"Aeropostale continues to outperform the peer group owing to its unique positioning of value-priced, trend right merchandise," Murchison wrote.

In premarket trading, shares of Aeropostale climbed $1.11, or 3 percent, to $36.99.