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IBDvalueinvestin (98.32)

Since Analysts think LTD will beat? Would a contrarian short it before earnings?



August 19, 2009 – Comments (2) | RELATED TICKERS: LB

Or would he wait till earnings then short the pop up??

Analyst sees Limited Brands recovery in 4QAnalyst sees Limited beating expectations in 2Q, but doesn't see recovery until later in year On Wednesday August 19, 2009, 12:02 pm EDT   Limited Brands Inc.

NEW YORK (AP) -- Specialty retailer Limited Brands Inc. reports fiscal second-quarter results after the market closes Wednesday, but one analyst said she doesn't expect markedly improved results until the fourth quarter.

Retailers such as Limited Brands Inc., which operates Bath and Body Works and Victoria's Secret, have suffered from falling sales as consumers cut back. In response, they have cut costs and lowered inventory levels.

Lazard Capital Markets analyst Todd Slater said in a note to investors that Limited's belt-tightening will likely lead to an earnings beat. He expects earnings of 17 cents per share, a penny above company guidance of earnings of 11 cents to 16 cents per share due to cost cutting. Analysts polled by Thomson Reuters, on average, expect a profit of 16 cents per share.

Still, Slater said the company's second- and third-quarter results are likely to suffer due to the recession. In the fourth quarter, however, Columbus, Ohio-based Limited Brands could recover, helped by easing comparisons from a year ago.

He reiterated his "Buy" rating on the stock.

Shares of Limited Brands rose 28 cents, or 2 percent, to $14.25 during midday trading.


2 Comments – Post Your Own

#1) On August 19, 2009 at 1:46 PM, cthomas1017 (98.68) wrote:

Contrarians run their investment strategies contrary to sentiment, not facts.  If there's a valid reason that the stock price will go up based on improved earnings, a contrarian won't go the opposite way because someone said that the price would increase.  Well, perhaps a stupid contrarian would. ;)

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#2) On August 19, 2009 at 1:55 PM, IBDvalueinvestin (98.32) wrote:

hmmm , I didn't think of it in those terms. Good reply, thanks.

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