Thursday, March 27, 2014

Seeking Alpha: Gordmans Stores' Merchandising Problems Linger

Discount retailer Gordmans Stores (GMAN) has been a falling knife since the fall of 2013, as the company has exacerbated a weak underlying retailing environment with poor merchandising decisions that have hit same-store sales hard and depressed margins. Although Gordmans' results weren't out of line with expectations for the quarter, they were still weak and the company announced that the CEO had elected to retire.

Gordmans Stores may benefit from a new vision or voice at the top, as the company's robust store growth of recent years is not producing compelling comp-growth. The good news here is that even in a tough quarter the company was still profitable and it does not take particularly aggressive model assumptions to suggest value in the shares. This is a speculative call, and the sell-side has slashed its price targets by almost half in the last four months, but simply stabilizing the comps could a make a significant difference.

Follow this link to the full article:
Gordmans Stores' Merchandising Problems Linger

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