AnnTaylor Stores (ANN) chief operating officer Barry Erdos resigned from the company and board. Prudential downgraded the shares to neutral from overweight.
Analyst Stacy Pak says in light of the announced resignation of COO Barry Erdos, she believes there is little risk to AnnTaylor in the near term, and she suspects February comparable-store sales will be above plan. However, she notes that Mr. Erdos led many of the important operational initiatives over the last couple of years, and his departure highlights a pattern of management turnover at the company.
Pak says the stock has had a great run, so she's taking this opportunity to downgrade. She maintains EPS estimates of $2.11 for fiscal year 2004 (January) and $2.49 for fiscal 2005. She raised her $42 price target to $45.