Preteen fashion boosts Aeropostale

NEW YORK (Reuters) - Clothing chain Aeropostale's (ARO.N) focus on the preteen market could spur growth and boost its earnings, Barron's reported in its July 5th edition.

In the first quarter of 2010, the company saw a 14 percent gain in sales and a 55 percent jump in earnings to 48 cents a share. For the full year, it is expected to post earnings of $2.80 per share, Barron's said.

Aeropostale has outperformed higher-priced rivals, such as American Eagle Outfitters (AEO.N) and Abercrombie & Fitch (ANF.N), in same-store sales growth.

The company has no debt and $313 million in cash on its balance sheet, which will likely fund new store openings, including 22 to 30 new P.S. stores that appeal to preteens, according to Barron's.

Still, the weak economy and sagging consumer confidence remain a threat to the retailer.

(Reporting by Helen Kearney)