Wet Seal Stock Surges on Word of 31% Quarterly Gain

Wet Seal Inc. posted a 31% gain in net income for the third fiscal quarter on higher sales, prompting a surge Tuesday in the company’s stock.

Wet Seal shares rose 13%, or $3.38, to $29.31 as more than 1.3 million shares changed hands, more than five times the average daily volume for the last three months.

The retailer of young women’s clothing and accessories said net income for the quarter climbed to $5.5 million, or 39 cents a share, from $4.2 million, or 30 cents a share, for the like period last year. Sales for the quarter ended Nov. 1 increased 9% to $104.4 million from $95.6 million, while same-store sales, a key industry indicator, climbed 5.7%.

Analysts had estimated that the company would earn 32 cents per share for the quarter. John Olinski, an analyst at Wedbush Morgan Securities Inc., said Wet Seal normally has same-store sales growth of 3% to 5% for any given quarter.

For the nine months, Wet Seal’s profit advanced 51% to $12.4 million, or 89 cents a share, from $8.2 million, or 61 cents a share, for the comparable three quarters of fiscal 1996. Sales rose 9% to $294.3 million from $270.5 million.