Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Gordmans Stores' Merchandising Problems Linger

Discount retailer Gordmans Stores (NASDAQ:GMAN) has been a falling knife since the fall of 2013, as the company has exacerbated a weak underlying retailing environment with poor merchandising decisions that have hit same-store sales hard and depressed margins. Although Gordmans' results weren't out of line with expectations for the quarter, they were still weak and the company announced that the CEO had elected to retire.

Gordmans Stores may benefit from a new vision or voice at the top, as the company's robust store growth of recent years is not producing compelling comp-growth. The good news here is that even in a tough quarter the company was still profitable and it does not take particularly aggressive model assumptions to...

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