With disappointing earnings reports for those stores who have released them, one cannot help but wonder if this is but a setback, or the beginning of the end. Consumer’s preferences have shifted towards online shopping experiences and brick and mortar stores are suffering the consequences.
Twilight of the Retail Gods: Are the Famous Big-Name Stores Doomed?: (Release 15/05/16) John Persinos (@JohnPersinos1), editorial manager at Investing Daily, comments on the underperforming share prices for the big stores giants. He called last week’s earnings releases a “carnage” (Macy’s, Kohl’s, Nordstrom) and argues online businesses have turned the once-dominant brand-names stores into dinosaurs. The new trend, and most importantly, the effective trend, is to invest in companies with “disruptive technologies.” To make it more obvious, he mentions that the SPDR S&P Retail ETF has registered a decline of 4.58% between 8th-13th of May and 5.09% yearly decline.
Jim Cramer – Will Target, Costco Avoid Retail Earnings Bloodbath?: (Release 13/05/16) Bret Kenwell (@BretKenwell) gives an insight of what Jim Cramer, money manager and host of CNBC’s “Mad Money” program, will be watching for this week. After last week’s retail releases falling short, the ones coming up have all eyes on them to see if they can outperform the estimates and maybe allow some hope for the industry itself. A couple to have in mind are Costco Wholesale, and Target, the first having an advantage over the latter.
Trader’s Notebook: Resist Piling On Beaten Down Retail: (Release 13/05/16) Bob Byrne (@ByrneRWS) uses a very graphic vocabulary to describe the retail downfall over last year, and thinks that last week’s earnings reports are but a reminder of how poorly they have performed. That being said, he is not holding his breath for the upcoming reports.
Retail Earnings Parade Begins: Target, Wal-Mart In The Spotlight: (Release 15/05/16) Wall street analysts expect revenue to decline for both of these stores, yet expect earnings growth to increase for Target. Estimize believes revenue will be $16.36 billion while Wall Street analysts believe it will most likely be $16.32, either way it would be the lowest quarterly revenue in the past two years. Several other retailers are analyzed but not with unlike results; they are all expected to have a lower EPS than the prior year.