Denim Wars: Who Has the Best Deal for Back to School?

Aeropostale

Aeropostale is featuring a 50%-off denim promotion, with men's original boot cut jeans now $22.25 from $44.50 and girl's jeggings $23.25 from $46.50.

Earlier in the month, Aeropostale was offering $10 off denim, but this promotion actually increased the price of denim, according to Chen. After the promo, denim was between $24 to $28 for men's and $22 to $26 for women's, compared with $20 last year.

"Aeropostale's back-to-school assortment is wear now, and is more edited, with fewer colors and a return to classic preppy styles that are brighter and more appropriate for the younger customer," Chen noted. "Denim does not seem to be emphasized in this initial floorset, which given the heatwave, could be beneficial as the customer is still looking for shorts and wear-now apparel."

Aeropostale warned investors of a smaller-than-expected profit in its second quarter. Management slashed its outlook to earnings of 2 cents to 3 cents a share, including a 6-cent benefit related to a dispute with a vendor. This compares with a prior forecast of 11 cents to 16 cents a share. Wall Street was looking for a profit of 13 cents.

For the three-month period, the company reported a 5% decline in sales to $468.2 million, shy of Wall Street's estimate of $491 million. Same-store sales plunged 14%.