Markets

Consumer Sector Update for 02/21/2018: RCII,WWW,AAP,RUTH

Top Consumer Stocks

WMT -2.00%

MCD +1.74%

DIS +0.14%

CVS -1.69%

KO -0.66%

Consumer stocks were endly widely mixed Wednesday, with shares of consumer staples companies in the S&P 500 sinking more than 0.4% this afternoon while shares of consumer discretionary firms in the S&P 500 were rising more than 0.7% in recent trade.

In industry news:

Same store sales at the 20 largest retail chains rose 3.7% during the week ended Feb. 17 compared with the same week last year, the strongest reading since Jan. 20 and adding 0.9 percentage points to the prior week's pace of growth. On a month-over-month basis, sales last week were again down 0.7% although the rate of decline slowed by 0.4 percentage points from the prior week. Month-to-date same-store sales were up 3.2% over the first three weeks of February 2016.

Among consumer stocks moving on news:

- Rent-A-Center ( RCII ) slumped Wednesday, dropping more than 10% to a session low of $8.01 a share, after the specialty retailer reported a wider-than-expected Q4 net loss as well as sale for the three months ended Dec. 31 trailing Wall Street expectations. The company recorded a net loss of $0.41 per share for the October-to-December reporting period, expanding on a $0.23 per share loss last year and also missing the Capital IQ consensus expecting a $0.07 per share quarterly loss. Total revenue fell to $639.0 million from $684.1 million in the year-ago quarter, also lagging the $654.6 million Street view. The company also disclosed a new strategic program targeting several improvement goals, including a significant cost-reduction plan and a more targeted value proposition aiming to increase traffic along with more competitive pricing and a new refranchising program.

In other sector news:

+ Advance Auto Parts Inc ( AAP ) was surging Wednesday, rising as much as 13% to a session high of $119.30 a share, after the auto-parts retailer reported better-than-expected Q4 net income and sales, with material cost improvements helping to partially offset increased supply chain costs and the non-cash impact of inventory optimization. Excluding one-time items, it earned $0.77 per share compared with $1.00 per share during the year-ago period and beating the Capital IQ consensus by $0.12 per share. Total revenue grew to $2.04 billion from $2.08 billion last year, also exceeding the $2.02 billion Street view. Same-store sale slid 2.6% from year-ago levels, or less than the 3.8% decline analysts were modelling but also reversing a 3.1% increase during the final three months of 2016. The company also is expecting FY18 net sales in a range of $9.1 billion to $9.4 billion, trailing the $9.55 billion analyst mean. Same-store sales are seen falling between 2% to 0% compared with FY18..

+ Ruth's Hospitality Group ( RUTH ) was moderately higher Wednesday afternoon following the restaurant chain reporting adjusted Q4 net income of $0.44 per share, up from $0.31 during the same quarter last year and topping analyst projections by $0.05 per share. Revenue rose to $124.1 million in the quarter from $107.6 million during year-ago levels, also edging past the $123.4 million consenus.

- Wolverine World Wide ( WWW ) was getting stomped Wednesday, although shares of the footwear and branded apparel company have more than halved a prior 6% decline to a session low of $28.91 a share, that followed it reporting below-consensus Q4 sales. Net sales fell to $578.6 million from $829.6 million during the same quarter last year and missing the Capital IQ consensus expecting $579.9 million in sales for the three months ended Dec. 30. Excluding one-time items, the company also earned $0.41, up from adjusted profit of $0.34 per share during the year-ago period and matching analyst estimates. Looking ahead to FY18, Wolverine is projecting adjusted per-share earnings in a range of EPS of $1.95 to $2.05, boosting the top end of its prior outlook by 25% and straddling the $2.01 per share Street view.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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