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PE Turning to Teen Retailers Amid Black Friday Rush

As shoppers rush to the malls, private equity is also taking greater interest in teen retail names, Lori Wachs, president of Cross Ledge Investments, told CNBC on Friday.

"We are seeing a lot of private-equity activity," she said.

"If you have to look at the enterprise value to the operating costs, you look at a lot of the names in the teen space, American Eagle and Aeropostale ."

"I wouldn't expect a name like Urban Outfitters to be taken out anytime soon, though," she added.

Market Breeding Bullishness?

Whether it's high-end jewelry or a cup of coffee, shoppers are feeling more bullish on both big and small purchases, said Wachs.

"The stock market has made that [high-end] consumer feel better about their balance sheet," she said. "Income is starting to pick back up, and although the employment rate still seems somewhat high, these people — now that we're coming out on the other end of the recession — they still have their jobs, they're starting to feel better."

While the promotions may not be as deep as expected, said Brian Sozzi, an analyst at Wall Street Strategies, both traffic and shopping-bag count have increased compared to a year ago.

"Last year many people came to browse," he added. "This year they came to buy."

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Disclosures:

Disclosure information was not available for Wachs or her company.

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