Retail

5 Major Retailers That Crushed Shareholders Last Week

Chris Lange

Published: May 15, 2016 9:40 am

Last Updated: January 13, 2020 8:03 am

Retail stocks took a serious dive this past week as many retailers reported weak earnings and sales trends. Some of these companies blamed the weather, weak comparable sales, guidance or even the rise of Amazon.

Analysts at Cowen even believe that Amazon.com Inc. (NASDAQ: AMZN) will be the number one U.S. apparel retailer by 2017. This would only bring even further sales and earnings destruction for brick and mortar retail companies across the board.

24/7 Wall St. chose some of the largest losers from this week. As noted, this fallout ultimately extended through the almost the entire retail industry.

Other companies that lost at least 10% this past week include Michael Kors, Pier 1, Staples and Office Depot.

For those retailers featured, 24/7 Wall St. has included their recent trading history, as well as the 52-week trading range and the consensus analyst price target. Additional color around the news was added on each company.

Gap

Early in the week, Gap Inc. (NYSE: GPS) posted its April and fiscal first-quarter sales results. The company reported $1.12 billion in net sales for the four-week period ended April 30, which compares to $1.21 billion in the same period of the previous year. In terms of the first-quarter sales, Gap said it had $3.44 billion, which fell short of last year’s first quarter of $3.66 billion in sales.

Consensus estimates had predicted revenues of $3.50 billion for the first quarter. Comparable sales for the quarter were down 5%, versus a 4% decrease last year.

Last week, the share price fell 18.8% and closed at $17.60 on Friday. Its consensus analyst price target is $21.13. The 52-week trading range is $17.33 to $39.59.

24/7 Wall St.
Why Disney Still Looks Attractive to Wall Street and Main Street

Macy’s Inc. (NYSE: M) reported first-quarter 2016 results before markets opened Wednesday. The department store giant posted quarterly adjusted diluted earnings per share (EPS) of $0.40 on revenues of $5.77 billion. In the same period a year ago, Macy’s reported EPS of $0.56 on revenues of $6.23 billion.

First-quarter results also compare to the consensus estimates for $0.36 EPS and $5.93 billion in revenue. Comparable store sales for owned plus licensed stores fell 5.6% in the quarter, and they fell 6.1% on the company’s owned stores. Net sales fell 7.4% year over year.

The company lowered its full-year same-store sales guidance to a decline of 3% to 4%, while previously the company had forecast a decline of about 1% in 2016. EPS guidance was also cut, from a prior range of $3.80 to $3.90 to a new range of $3.15 to $3.40. For the full year, analysts were looking for EPS of $3.80 on sales of $26.49 billion.

Over the course of the week, the stock retreated about 17.1%. Shares of Macy’s ended Friday at $31.22. The consensus analyst target is $39.41, and the 52-week range is $30.36 to $73.61.
Kohl’s

Then on Thursday, Kohl’s Corp. (NYSE: KSS) reported its fiscal first-quarter 2016 results. The department store operator posted EPS of $0.31 on revenues of $3.97 billion. In the first quarter of 2015, it reported EPS of $0.63 on revenue of $4.12 billion.

First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.37 and $4.13 billion in revenue. Same-store sales for the quarter fell 3.9% year over year, compared with a 1.4% rise in the first quarter of 2015.

Last week, shares of Kohl’s fell 13.6% to close out the week at $35.74. The consensus price target is $43.68, and the 52-week range is $33.87 to $66.86.

Nordstrom

Also on Thursday, Nordstrom Inc. (NYSE: JWN) reported first-quarter 2016 results after markets closed. The department store giant posted quarterly EPS of $0.26 on revenues of $3.2 billion. In the same period a year ago, Nordstrom reported EPS of $0.66 on revenues of $3.1 billion.

First-quarter results compare to the consensus estimates of $0.46 EPS and $3.28 billion in revenue. Comparable store sales for the quarter fell 1.7%. Net sales rose 2.5% year over year.

The company lowered its full-year same-store sales guidance from a prior range of flat to up 2% to a new range of negative 1% to plus 1%. Net sales, previously forecast to rise 3.5% to 5.5%, are now forecast to rise 2.5% to 4.5%. Diluted EPS guidance has fallen from a prior range of $3.10 to $3.35 to a new range of $2.50 to $2.70.

The stock dropped 18.5% over the week. Shares closed Friday at $39.16, with a consensus price target of $51.96 and a 52-week range of $37.99 to $80.23.

Fiscal first-quarter 2016 results from J.C. Penney Co. Inc. (NYSE: JCP) were reported before markets opened on Friday. The venerable retailer reported a net loss per share of $0.32 and $2.81 billion in revenues. In the same period a year ago, it reported a net loss of $0.57 per share on revenue of $2.86 billion.

First-quarter results also compare to the consensus estimates for a net loss of $0.38 and $2.92 billion in revenue. Same-store sales slipped 0.4% in the quarter, compared with an estimate from Retail Metrics for growth of 2.9%.

The company also updated its full-year guidance. It continues to expect same-store sales to rise by 3% to 4% but also expects adjusted EPS “to be positive,” and free cash flow is forecast to “improve.” The consensus estimates call for a second-quarter loss of $0.11 per share on revenue of $2.95 billion. Full-year estimates include EPS of $0.04 on revenues of $12.97 billion.

Over the past week, the stock was down 8.1%. Shares ended the week at $7.59, within 52-week range of $6.00 to $11.99. The consensus price target is $11.46.