Aeropostale Lifted by Line of Credit

After 6 straight quarterly losses, the teen-focused retailer's stock moves up after a lifeline from an investor.
3:19 | 05/27/14

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Transcript for Aeropostale Lifted by Line of Credit
I'm Michelle Branch of the New York it's Tuesday may 27 and this this story stops today the reviving fortunes. Of Arab hospital after reporting -- six straight quarterly loss last week. The teen focused retailer is back in the air again. By Aaron task of Yahoo! finance so Aaron just last week the company -- grounded what happened to help but today. Well they they got a 150 million dollar credit facility from one of their biggest investors sycamore. And it's essentially a lifeline. This is a company that's been hemorrhaging cash the sales have been down for six straight quarters. And the I think the stock is moving takes a big percentage move. But it it's still down sixty plus percent so far this year. And at a fraction of its all time high back in 2010. And so this this is being looked at mainly as a a life saving event as opposed to a sign that while things are really great opera stuff. -- Aaron let's see what -- 150. Million dollars in credit did for the company's stock today walk us through. Well it's it's a big jump in the stock is up fifteen plus percent. Oh lead in trading today but this is still under five dollar stock. I'll see you get these big percentage moves and again you some of the analysts that there -- basically saying that this is get a give them you know another year or so of cash of the current burn rate given an opportunity. To maybe turn things around at the store level but. You know there were the reality is is that. They had major struggles in the core business. And so they bought themselves some time and an opportunity. But it's still a long way to go to get back to you anything resembling that their former glory and output air quotes around the world we're glory. -- well certainly. Many say that they may be kicking the can down the road as you mentioned -- this money doesn't necessarily solve -- -- Arab hostile buys time. But doesn't really mean that those shoppers mostly kids and teens are going to buy from this company. So what is the company doing to improve its bottom line. -- -- well the other thing getting his big cash infusion from sycamore -- they -- they announced is that they're they're adding some people to their board of directors. Most -- Julian Geiger -- their former CEO. There's also -- Kenneth Gilman who's been nominated. He's a director ad sales and Kate Spade so they're trying to bring in some retail talent as we've seen -- JC Penney. As we've seen this year's you know retailing it is more of an art than a science. I unity had a guy like Ron Johnson knew that they be genius at apple -- -- -- a JC -- pound was the place up. Because you're getting the right product mix getting the stores to look rate it's a huge challenge for any retailer. Especially when it caters you fickle teens now the good news there's that teens are fickle so -- That -- offerings to get something that is gonna get the teens in the stores like the gap did last year. They can be turning things around any any quick -- but again that's the opportunity for opera style and they bought themselves some time to do it but it's a lot easier said than done. Right and with though. Whole lot of competition out there fighting for nineteen dollars well exactly Aaron task of Yahoo! finance thanks for joining us. Thank -- you of course have been watching stories stocks stay with for your latest headlines I'm Michelle Franzen in New York.

This transcript has been automatically generated and may not be 100% accurate.

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