Oppenheimer Lowers TLB Estimates

Talbots, Inc. TLB provided an updated outlook on 4Q10 yesterday morning. “Citing a weaker than expected response to the new merchandise assortment, a highly promotional mall environment and difficult weather conditions, management lowered 4Q and FY10 guidance to $(0.15)-(0.19) and $0.56-0.60, Oppenheimer writes. “This compares to a previously announced $(0.05)-0.03 and $0.70-0.78 for 4Q and FY10, respectively. As a result, we are adjusting our 4Q10E, FY10E, FY11E and FY12E downward to $(0.17), $0.57, $0.72 and $0.98 from $(0.02), $0.73, $0.83 and $1.05, respectively.” Oppenheimer said that its long-term thesis is intact. “We believe TLB is in the early stages of a turnaround and view this weakness as a buying opportunity for investors with a longer time horizon, keeping in mind that we do not expect the company to gain traction until 2Q at the earliest,” Oppenheimer adds. Talbots currently trades at $6.24.