While most of the stock market has reported earnings, we're
still in the midst of hearing from the retailers. With the U.S.
economy being mostly consumer-driven, these reports are usually
critical in trying to understand economic trends.
So far, it has been an extremely mixed earnings season.
For some retailers, there were no problems in the second
quarter. Luxury retailer Michael Kors saw same store sales rise
27.3% and Tiffany had same store sales growth of 5% with gains in
But it's not only the luxury end which saw growth.
Dollar General just reported a record second quarter with same
store sales growth of 5.1% on increased traffic. Consumable sales,
including tobacco, perishables, candy and snacks, led the
The auto retailers are also having their best year since the
Great Recession, with double digit sales growth. The good times
continued in August, as car and truck sales were the highest in 7
But not all the retailers are smelling like roses. Wal-Mart, the
king of retailers, recently lowered full year guidance. On the
higher end, Macy's missed on the Zacks Consensus Estimate for the
first time in 5 years and saw its first sales decline since
The teen retailers have been awful. American Eagle saw same
store sales fall 7% on weak traffic and a slowdown in women's
sales. It also said the retail environment had become "highly
promotional." It saw the weakness continuing into the third
Abercrombie & Fitch said the same thing: weak traffic and
continued softness in women's with same store sales falling 11% in
the second quarter. Aeropostale had a "negative" outlook for the
third quarter and said it expects that to continue due to the
competitive teen retail environment.
But other non-teen retailers have also reported weaker store
Women's fashion accessory and apparel maker Francesca's, which
targets the female 18-to-35 demographic, missed on the Zacks
Consensus Estimate today and lowered third quarter guidance. Same
store sales fell 1% in the second quarter. Like the teen retailers,
it said traffic was weak, especially in July, and remained so into
Are middle class consumers eschewing discretionary items like
clothes, sunglasses and handbags, for "essential" items like food
What does it mean for the U.S. economy in the second half of
the year if the consumer is turning cautious?
ABERCROMBIE (ANF): Free Stock Analysis Report
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