The president of the Martin + Osa clothing chain left her job with little fanfare in December, giving investors another reason to wonder how much longer parent company American Eagle Outfitters Inc. will be willing to invest in its ongoing experiment in selling to the post-college crowd.

Laura Dubin Wander, who had held the job since spring 2007, left to "pursue other opportunities," according to a spokeswoman for the South Side clothing company.

Meanwhile, comments at an investment gathering in California last month stirred up chatter that CEO James O'Donnell is ready to shut down the 28-store chain for 25- to 40-year-olds that was launched in the fall of 2006. Many in the investment community seem convinced Martin + Osa's days are numbered, said Thomas A. Filandro, an analyst with Susquehanna International Group.

But he and other analysts are not sure management has given up, and opinions seem mixed on what would be the best move.

"We believe investors have been looking for news surrounding a potential closure of M+O since President Laura Dubin Wander was let go in December, but we give the odds of definitive closure at 50-50," wrote Adrienne Tennant, an analyst with FBR Capital Markets, in a late January research note.

In mid-January, Pali Research analysts wrote that the future of the chain wasn't clear. "While the concept shows improvement, it clearly fell short of expectations and at this juncture, we are frustrated with management's inability to pull the cord on this fledgling concept."

Mr. Filandro thinks investors could see benefits either way. While shutting down the chain might mean a short-term boost for investors tired of the expense, it also could mean lost opportunity for a long-term gain from a project that's already up and running in a prime niche.

The 950-store American Eagle brand is running out of growing space, and is counting on concepts such as its fast-growing lingerie chain, aerie, and its still tiny venture in children's wear, 77kids, to build sales. Martin + Osa is part of that strategy, too.

Mr. Filandro said investors want revenue growth, too. "We really do still need a growth vehicle. It makes sense that this one would be the next place for us to be."

But from the start, this one has been a challenge. Not long after the first stores opened, the chain's first president left. Various top executives with American Eagle have since helped work on the project.

At the moment, the chain's website is touting new merchandise such as a $160 V-neck cardigan made of cashmere and silk, a $110 denim jacket and a $29.50 artisan T-shirt.

The thirty-something crowd seems to be harder to dress than high school and college students. In June, Abercrombie & Fitch decided to close its 29-store Ruehl chain, which had targeted 22- to 35-year-old men and women, citing a difficult economy. A couple of years ago, Gap closed all of its Forth & Towne stores aimed at women over 35.

At the end of the last fiscal year, officials said Martin + Osa had been a bigger drag on earnings than expected, in part because a lot of merchandise had to be liquidated, and a strict goal had been set for the current fiscal year. No new stores were opened last year.

Still, there are signs of improvement. In his official comments at the ICR Xchange Conference this January, Mr. O'Donnell described the chain as having made solid strides, noting sales at stores open at least a year were up and the overall bottom line is stronger.

More shoppers began coming back to the stores for jeans. On the fashion front, he said customers wanted fresh styles more often, so Martin + Osa will bring in new merchandise every four weeks.

Then Mr. O'Donnell left his options open. He said the company still was evaluating its plans and would provide more information about the brand during a fourth-quarter earnings call scheduled for March.

Martin + Osa has fans. Amanda Davis posted a rave not long ago on TheFashionableHousewife.com. The 27-year-old stumbled across the store in Natick, Mass. Among other things, she found jeans that she said look great on her.

Early on, the brand took criticism for its prices. Ms. Davis didn't seem to have that issue. "They are not overpriced like some stores in my mall, and I feel like the value that I get when shopping there is pretty awesome. I always leave the store pretty proud of myself."

Mr. Filandro sees progress, but he said the chain still hasn't developed an identity. "You walk into Martin + Osa right now, I think nobody knows exactly who they are."

Although he didn't call out specific examples of chains that have developed brands, it's easy to think of a look associated with, say, a Talbots or a Hot Topic or even an American Eagle Outfitters store.

Mr. Filandro believes American Eagle officials have made their decision. If Martin + Osa gets more time, he expects Mr. O'Donnell to take a greater role in setting the chain's direction.

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