Why J.Jill Shares Are Getting Cut in Half

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J.Jill Inc. (NYSE: JILL) shares fell into a tailspin on Thursday after the company updated its third-quarter guidance. The company only came public back in March, but since then it has been a rocky road and shares have fallen over 20% since that time. Thursday is only piling on hurt.

For the third quarter 2017, J.Jill now expects total company comparable sales to decrease between 3% and 5%, with a moderate decline in gross margin as compared to last year.

At the same time, the company now expects GAAP diluted earnings per share (EPS) of $0.07 to $0.09, and adjusted diluted EPS of $0.08 to $0.10 for the coming quarter. Adjusted diluted EPS excludes approximately $0.6 million of nonrecurring expenses associated with the company’s transition to a public company.

Thomson Reuters consensus estimates are calling for $0.19 in EPS and $173.88 million in revenue.

J.Jill will provide its outlook for the fourth quarter and a revised outlook for the full fiscal year of 2017 when it reports third-quarter results on December 5.

Paula Bennett, president and CEO of J.Jill, commented:

We have experienced a lower than expected sales trend across both our retail and direct channels, and are updating our guidance for the quarter. We have been assessing the change in trend and have identified product and marketing calendar issues that are affecting traffic and conversion, and we are reacting quickly.

Bennett continued:

Given our long track record of consistent sales and earnings growth driven by a strong connection with our customers, we are very disappointed with our soft sales trend. I am confident in the actions we are taking to regain momentum and once again delight our customer with the product and service experience she expects from us.

Shares of Jill were last seen down about 50% at $4.95, with a consensus analyst price target of $14.22 and a 52-week range of $4.93 to $14.40.