Boston, MA 04\/10\/2014 (wallstreetpr) \u2013\u00a0Chico’s FAS, Inc. (NYSE:CHS) <\/b>is a $2.5 billion organization which operates women’s clothing stores. Shares of the company jumped 8.4 percent Tuesday, the highest gain in more than two years. However, Wednesday saw the shares back in the red.<\/p>\n
The shares jumped following regulatory filing that revealed that private equity firm Leonard Green owns a significant stake in the company. The report disclosed that Leonard Green controls 1.3 percent stake in the women’s clothing store operator. The institutional investor holds 2.05 million shares of CHS, making it among the top 30 large investors in the company.<\/p>\n
Leonard is a Los Angeles-based firm. It also holds positions in specialty retailers such as Sports Authority Inc and J. Crew Group Inc. The firm last year made acquisitions and entered joint ventures that included takeover of Lucky Brand Jeans and joint position in Juicy Couture for $225 million and $195 million cash transactions respectively. Given the firm’s record in specialty investment selection, its move to acquire a significant stake in CHS helped to boost investor confidence in the stock.<\/p>\n
Chico’s FAS, Inc. (NYSE:CHS) owns and operates more than 1,400 specialty stores. The company’s brands include Soma Intimates and WH\/BM. The company faced several changes in the past year which ended up weakening its revenue and earnings. The company struggled with declining sales amid completion and reduced spending in clothing items.<\/p>\n
In the face of the challenges, the company witnessed its earnings falling in five consecutive quarters. The drop in earnings was attributed to low-price strategies that the company tried to undertake in order to boost store traffic. Sales in the most recently reported fourth quarter dropped 6.4 percent. Gross margin in the quarter also remained weak amid price cuts.<\/p>\n
Short-lived rally<\/b><\/p>\n
Although the disclosure that Leonard Green holds a significant position in the company served to boost market confidence, the gain was short-lived as the stock shows more weaknesses than strength.<\/p>\n
Tread carefully<\/b><\/p>\n
There may be opportunities lying ahead for Chico’s FAS, Inc. (NYSE:CHS), however, currently analysts are bearish about the stock. The past one month saw the stock suffer a negative earnings estimate revision, compared to no positive revision.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 04\/10\/2014 (wallstreetpr) \u2013\u00a0Chico’s FAS, Inc. (NYSE:CHS) is a $2.5 billion organization which operates women’s clothing stores. Shares of the company jumped 8.4 percent […]<\/p>\n","protected":false},"author":32,"featured_media":19254,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[2236],"tags":[3240,1244],"stock_ticker":[],"class_list":["post-19253","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-chicos-fas-inc-nysechs","tag-nysechs","entry"],"acf":[],"yoast_head":"\n