• Home
  • News
  • Business
  • J.Jill’s stock halved its value after retailer lowered Q3 profit forecast

J.Jill’s stock halved its value after retailer lowered Q3 profit forecast

By Angela Gonzalez-Rodriguez

loading...

Scroll down to read more

Business |ANALYSIS

Shares of J. Jill Inc lost half their value on Thursday, after the U.S. womenswear chain slashed its third-quarter profit forecast due to a slowdown in traffic to its stores.

“We see the miss as largely explainable, and believe the company is sufficiently nimble to address the missteps in short order,” Jefferies analyst Randal Konik said, adding that the ongoing issues were expected to reflect on the company’s performance through October.

Analysts cited by Reuters said the company’s problems were compounded by the overall slowdown in traffic to apparel stores due to unseasonably warm weather.

J.Jill shares hit record low since IPO

As a result, the Massachusetts-based J. Jill saw its shares sink to a record low of 4.85 dollars, well below its March IPO price of 13 dollars. The main reason for this major low seems to lie in the company’s forecast drop in quarterly same-store sales.

Meanwhile, analysts at Deutsche Bank slashed its price target on the stock by 5 dollars to 11 dollars, while Jefferies cut its target to 13 dollars from 16 dollars. Five out of nine brokerages following the stock recommend to ‘hold’ onto the shares, while the remaining four rate the stock ‘buy’ or higher. Their median price target is 9 dollars.

The company went public in March amid a tough environment for apparel retailers, several of which have gone out of business in the last couple of years as they struggle to cope with changing consumer tastes and growing pressure from Amazon.com Inc and other online retailers.

Image:J.Jill Web

J.Jill