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Earnings Watch: Department Stores On Deck

By Estimize Stock MarketsAug 09, 2017 01:54PM ET
www.investing.com/analysis/earnings-watch-can-department-stores-take-the-heat-200206319
Earnings Watch: Department Stores On Deck
By Estimize   |  Aug 09, 2017 01:54PM ET
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Nordstrom Inc. (NYSE:JWN) Reports: 8/10/17

The Estimize consensus calls for EPS of $0.65, two cents higher than Wall Street’s consensus of $0.63. Currently, the Estimize community is looking for revenues of $3,734M, roughly in line with the Street’s expectation for $3,732M.

What to Watch: Retail sales and mall traffic have been plunging; there’s no way around that fact. Despite the Nordstrom family wanting to take the stock private to work on a turnaround, it has still fared better than its other retail competitors. Nordstrom is set to open its sixth Canadian store, as well as a line of its daughter store, Nordstrom Rack, in the coming months. Since Canada’s economy has seen a spike in 2017, its GDP on track to grow 3% in the next year, this could be a positive move for the company. More things impacting Nordstrom could be the downsizing of its competitors. For example, Neiman Marcus has closed three of its Last Call locations and is planning to take a look at the chain as a whole. Likewise, Hudson's Bay (TO:HBC), owner of Lord & Taylor and Saks Fifth Avenue, is also looking to downsize as retail continues to take a beating.

Macy’s Inc. (NYSE:M) Reports: 8/10/17

The Estimize consensus calls for EPS of $0.42, two cents lower than Wall Street’s consensus of $0.44. Currently, the Estimize community is looking for revenues of $5,482M, slightly lower than the Street’s expectation for $5,501M.

What to Watch: Last quarter, the store came out with a negative earnings surprise of $31.4. Analysts polled by Zachs have predicted revenues of $5,490, down 6.4% from last year. Over the last three months the stock has declined 19%, a wider margin than the industry-wide decline of 4.8%. Major deterrents for Macy’s have consistently been decreasing mall traffic, aggressive pricing strategies and increased competition. Retail stocks in general have been under scrutiny as the sector continues to change.

Kohl’s Corporation (NYSE:KSS) Reports: 8/10/17

The Estimize consensus calls for EPS of $1.19, one cent higher than the Wall Street consensus of $1.18. Currently, the Estimize community is looking for revenues of $4,116M, roughly even with Street’s expectation of $4,109M.

What to Watch: Unlike other retailers’ brick-and-mortar stores, Kohl’s’ is a positive asset to the stock's performance. Because its locations are found in suburban strip malls, its performance has not been hurt by declining traditional mall traffic. Likewise, unlike other retailers who are considering closing locations, Kohl’s has decided to focus on certain brands, cut down inventory and decrease store size. Studies have shown that 80% of Americans live within 15 miles of a Kohl’s location, indicating that it is convenient and accessible, especially with back-to-school shopping just around the corner. To top things off, Kohl’s’ dividend yield is a whopping 5.2%, another reason to consider giving this stock a chance.

JC Penney Company (NYSE:JCP) Reports: 8/11/17

The Estimize consensus calls for EPS of -$0.04, two cents higher than the Wall Street consensus of -$0.06. Currently, the Estimize community is looking for revenues of $2,860M, slightly higher than the Street’s expectation for $2,853M.

What to Watch: In the last four quarters, the company has beat the Zachs consensus by an average of 50.9%. The company has stated that its sales have been up in the latter half of the 2017 fiscal year. The company has also revamped its rewards program to compensate loyal customers and increase sales. For every 200 points earned, customers will earn $10 in store credit. However, in order to go along with its restructuring plan, the company will be shuttering two distribution facilities and 130-140 stores, which makes up roughly 13-14% of its portfolio and will decrease its annual sales by roughly 5% or less.

There's definitely a lot going on for J.C. Penney and the rest of the brick-and-mortar gang so let us know what you think.

Original Post

Earnings Watch: Department Stores On Deck
 

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Earnings Watch: Department Stores On Deck

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