Delia's Shares Fall on 2Q Loss

NEW YORK (AP) -- Shares of Delia's Inc. hit a 52-week low on Friday, after the teen clothing retailer and direct marketing company recorded a wider second-quarter loss.

After the market closed on Thursday, the New York-based company said its loss grew to 16 cents per share from 12 cents per share in the year-ago quarter. Analysts polled by Thomson Financial expected a loss of 12 cents per share.

Raymond James analyst Samantha Panella said Delia's had lower direct sales and higher expenses than she expected.

Panella said it appears Delia's year-over-year growth in same-store sales decelerated during the quarter.

"As a result, it marked down its merchandise in order to clear its excess inventory in the quarter to make room for back-to-school merchandise," Panella wrote.

She lowered her earnings estimate for the third quarter from 19 cents to 16 cents per share, but kept her "Market Perform" rating on the stock.

C.L. King & Associates analyst Mark Montagna kept an "Accumulate" rating and $8 price target on the stock.

"Our investment thesis has been based on strong management, substantial store growth opportunities, significant operating margin potential, minimal debt and self-funded organic growth capabilities," he wrote. "Although the merchandise performance has been erratic, we believe there is a favorable risk-reward ratio toward the long-term success of Delia's merchandise."

Shares sank 80 cents, or 14.9 percent, to $4.56 during afternoon trading, after earlier reaching a 52-week low of $4.38. The stock had traded between $5.20 and $12 during the past year.