After the close on Wednesday, L Brands Inc LB reported Q1 adjusted EPS of $0.59 versus estimates of $0.55. The strength in earnings supports management's view that customers are willing to pay up for compelling products, but remain value oriented. Looking out to Q2 and FY 2016, L Brands issued guidance that was below consensus estimates.
JPMorgan's Matthew Boss slashed his FY 2016 EPS from $4.00 to $3.75. Same-store sales are expected to remain flat throughout the remainder of the year as the company wrestles with gross margin contraction and merchandise margin erosion.
Boss maintained a Neutral rating on L Brands and lowered his price target from $61 to $60.
Shares of L Brands closed Thursday's session down almost 5 percent to $60.62.
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