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Is It Too Early To Take A Run At Aeropostale?

Shares of teen-oriented retailer Aeropostale (NYSE: ARO) have struggled mightily to generate positive returns over the past year, down more than 30%. The company was hurt by weak sales momentum in FY2014, evidenced by an 11% drop in comparable store sales, which led to a continued heavy use of promotions to drive customer purchases, culminating in another adjusted operating loss. On the upside, though, management seems to be highly focused on turning Aeropostale's financial performance around through an ongoing restructuring program that has included the downsizing of its overall store network, a strategy that holds the promise of better profitability in the future. So, at its discounted price, is the company a good bet for investors?

Aeropostale is a major player in the teen-oriented segment of the retail sector, operating a network of roughly 900 stores that cater to a predominantly teen-age demographic with an assortment of apparel and accessories offerings. Read more