Why Express Stock Skyrocketed Today?
Jan 22, 2020 by InvestorDestination Team
Today Express, Inc (NYSE EXPR) narrowed its fourth-quarter guidance and announced its new corporate strategies. Investors liked the news and its stock shot up more than 18%.
It has announced new strategies and key initiatives to reduce costs and improve comp sales and expects that to result in margin expansion. The company is planning to close approximately 100 stores by 2022. It is planning to improve customer retention and acquisition through the loyalty program and private credit card. Like many retailers, its e-commerce sales are growing, and the company will continue to focus on increasing its omnichannel capabilities.
To turnaround the company, it is planning to improve all aspects of its business - product, go-to-market strategy, customer acquisition and retention, customer experience, inventory optimization, and reinvigorate the brand.
None of these are new ideas, but by narrowing its fourth-quarter guidance, the company is assuring investors in its ability to turnaround. In the fourth quarter, the company expects a 3% decline in its comp sale, which is better than the previous year's 6% decline.
Like most retailers, Express has been struggling. A year ago, it ousted the previous CEO and, in May 2019, hired a new CEO. The new CEO is trying to turnaround the company, and his strategies are showing signs of positive results. Its expected results show the third consecutive quarter of sequential improvement in its comp sales trends. So investors are regaining confidence in the new CEO’s ability to turnaround and grow profitably.
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