Target, JC Penney, Gap Fall Hard while Macy?s Outperforms

[Stocks-to-Watch]

Discounts and early Black Friday promotions may have given some shoppers a Merry Christmas, but December sales results from retailers paint a somewhat bleak picture for the industry.

Retailers posted mixed earnings results, and it turned out that analysts’ expectations for strong growth among discount stores turned out to be too optimistic. Overall, the retailers that have reported their same-store sales figures have shown a 3.4% gain over last year, which is 0.1% above analysts’ expectations for the group, according to estimates compiled by Thomson Reuters. But there were wide disparities within the group and stocks are swinging this morning.

Target (TGT) and JC Penney (JCP) both cut their earnings expectations for the fourth quarter as the companies posted disappointing December sales numbers. Target posted 1.6% growth, against expectations for 3.1% growth. The company now expects earnings to come in within a range of $1.35 to $1.43, below previous expectations for $1.43 to $1.53.

JC Penney posted 0.3% same store sales growth, which was actually above expectations for a 0.1% decline. JCP cut its EPS forecast to a range of 65 cents to 70 cents, after previously projecting earnings as high as $1.15. Target shares fell 4.7% and JCP shares fell 5%.

Shares of Kohl’s (KSS) and the Gap (GPS) also fell 2.4% and 5% respectively after posting disappointing results.

Macy’s (M), however, beat expectations by posting 6.2% growth, against expectations for 5% growth. The company raised its earnings projections by 3 cents. Shares were flat.



Original Article Source by Barrons.com