Talking Points

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An unwanted discount at J.Jill

Burlington, MA 031413 J.Jill at Burlington Mall has re-fashioned its campaign for boomer women, Thursday, March 14 2013. (Staff Photo/Wendy Maeda) section: Business slug: 15jjill reporter: Taryn Luna

Wendy Maeda/globe staff/file 2013

J.Jill at Burlington Mall.

There’s a big sale happening over at J.Jill. But this discount is for the shares, not the clothes.

The Quincy-based retailer’s stock lost half its value today, tumbling below $5, its lowest point by far since an initial public offering in March. The reason? J.Jill executives admitted that they couldn’t live up to the guidance they gave Wall Street back in August. At that time, J.Jill said sales at stores open at least a year would be up in the high single digits from 2016.

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Now, management says comparable sales will go in the opposite direction this quarter, dropping 3 to 5 percent. The earnings guidance was also pared back.

In some cases, popular items sold out quickly, and J.Jill couldn’t keep up with demand. But there were big misses -- items such as woven tops that sold much less than anticipated. The company also extended its August offerings for an additional week, a move that did not pan out.

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Some analysts are betting the company can overcome this setback, while others see more trouble on the horizon.

J.Jill has felt the pressure of Wall Street’s relentless focus on earnings before, in a previous life as a public company. The company endured ownership changes after being gobbled up by Talbots in 2006, and was largely shielded from Wall Street for nearly a decade under private equity control.

But J.Jill returned, Rip Van Winkle-style, to a very different stock market for brick-and-mortar merchants. As today’s reaction shows, investors are anxious about the retail sector’s future, and are ready to bolt after any significant misstep.

Jon Chesto is a Globe reporter. Reach him at jon.chesto@globe.com and follow him on Twitter @jonchesto.
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