Bon-Ton Stores Inc.
) which operates 272 stores in the Northeast, Midwest and upper
Great Plains, recently reported a 2.2% upside in same-store sales
for the four-week period ended August 25, 2012.
This compared favorably with a 4.7% decline in the year-ago
period. The comps benefited from the continuous efforts to
improve the merchandise collection and the enhancement of marketing
Total sales crept up 2.1% to $180.8 million for the month of
August, 2012 from $177.1 million in the comparable period ended
August comps were primarily driven by improved performance of
categories like ladies and special size sportswear, both moderate
and better; shoes; children's and home. The company also gained
strongly from fine jewelry sales.
Additionally, Bon-Ton continues to record double-digit sales
growth in eCommerce and considers it to be a significant growth
driver. Moreover, the company's various efforts such as market
share expansion of updated merchandise and marketing initiatives
are expected to drive sales further.
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Bon-Ton's year-to-date total revenue slipped 0.4% year over year to
$1,416.4 million and same-store sales were down 0.3%.
Same-store sales at Bon-Ton's rival
) jumped 3.4% in the four-week period ended, August 27, 2012. Total
sales rose 5.3% for the period.
Despite a challenging macroeconomic environment, U.S retailers
succeeded in achieving positive same-store sales growth for the
month of August, which is encouraging. The higher comps were mainly
aided by back-to-school promotions.
Bon-Ton remains upbeat with the August comps results and expects
the same trend to continue in 2012. The company expects comps
growth in the range of flat to 1.25% for 2012, up from the previous
estimate of negative 1.5% to positive 1.0%.
For 2012, Bon-Ton expects earnings in the range of loss of $1.35
per share to a profit of 20 cents per share, down from its prior
outlook of a loss of 95 cents to a profit of 50 cents per share.
However, the company reiterated its EBITDA guidance between $160
million and $190 million.
The Zacks Consensus Estimates for the third quarter and fiscal 2012
are pegged at a loss of $1.15 and 55 cents, respectively. The
estimates have not budged in the last 7 days, implying that the
analysts do not see any near-term catalysts.
The stock has a Zacks #3 Rank, implying a short-term Hold rating.
We also reiterate our long-term Neutral recommendation on