Vestis shares surge 8% after Q3 miss, cash flow outlook raised

Vestis shares jumped 8% on Tuesday after the company posted third-quarter results that missed analyst expectations but raised its cash flow outlook for the full year.

The specialty apparel retailer reported adjusted earnings per share of $0.45, below the $0.52 consensus estimate compiled by Refinitiv. Revenue totaled $1.2 billion, also falling short of forecasts for $1.3 billion.

Despite the underperformance in profitability and sales, Vestis raised its full-year cash flow guidance to between $300 million and $320 million, up from a prior range of $250 million to $280 million. The company attributed the revision to stronger-than-anticipated inventory management and cost efficiencies.

Vestis maintained its full-year adjusted EPS guidance of $1.80 to $2.00, signaling confidence in its operational improvements despite the near-term earnings shortfall.

Analysts noted the cash flow upgrade as a positive signal, given its direct impact on liquidity and financial flexibility. The stock’s 8% gain reflected investor optimism that the company’s strategic adjustments could offset weaker profitability in the quarter.

Vestis did not provide a detailed breakdown of segment performance or forward guidance beyond cash flow and EPS. The company’s next earnings report is scheduled for the first quarter of 2025.

The shares’ surge contrasted with broader retail sector weakness, where several peers have reported disappointing same-store sales and margin pressures amid shifting consumer spending trends.