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Is It Time To Sell Your Specialty Retail Stocks?
67 WALL STREET, New York - November 19, 2009 - The Wall Street Transcript has recently published its Q3 2009 Specialty Retail Report offering a review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available via The Wall Street Transcript Online.
Topics covered: Consumer Electronics -- Innovation -- Appliance Category -- Housing Market -- Video Games -- Growth of Amazon -- International Growth -- Positives of the Downturn -- Cross-Shopping -- Buying Trends -- Competition in Specialty Retailing -- Department Stores -- Balance in Merchandise -- Underselling -- Promotions -- Informed Customers -- Internet Stores -- Change in the Consumer -- Top-Line Expansion -- Lower Cost Structure -- Teen Consumers -- Back to School -- Stablization -- Consumer Spending Trends -- Shifts in Consumer Shopping Habits -- Comparable Store Sales -- Holiday Expectations -- Retailers Reaction to Shifts in the Economy -- Value
Companies include: Amazon (AMZN); Best Buy (BBY); Estee Lauder (EL); hhgregg (HHG); Conn’s (CONN); GameStop (GME); Staples (SPLS); OfficeMax (OMX); Office Depot (ODP); Abercrombie & Fitch (ANF); AnnTaylor Stores (ANN); American Eagle Outfitters (AEO); Buckle (BKE); Chico's FAS (CHS); Bebe Stores (BEBE); Ann Taylor (ANN); Coach (COH); Coldwater Creek (CWTR); Nordstrom (JWN); Dicks Sporting Goods (DKS); Foot Locker (FL); Steve Madden (SHOO); Skechers (SKX); Deckers (DECK); Hibbetts (HIBB); Shoe Carnival (SCVL); Target (TGT); Genesco (GCO); Urban Outfitters Inc. (URBN); True Religion Apparel Inc. (TRLG); GUESS? Inc. (GES); Lululemon (LULU); J.Crew (JCG); Hot Topic, (HOTT); Talbots (TLB); Chico's (CHS); Pacific Sunwear (PSUN); Kohl's (KSS); JCPenney (JCP); BJ's Wholesale (BJ); GUESS? (GES); Tween Brands (TWB); Gymboree (GYMB); Mens Wearhouse (MW)
In the following brief excerpt from just one of the in depth interviews in this Special Report, an award winning equity analyst discusses the outlook for the sector and for investors.
Christine Chen joined Needham & Company in 2007; she is a Principal and Senior Research Analyst with over 12 years of experience following retail. Ms. Chen joined Needham from Pacific Growth Equities, where she also covered specialty apparel retailers. Previously, she was an analyst at Tiburon Research Group, an independent equity research group also focused on retail. Before TRG, she was a retail and consumer investment banker in Credit Suisse's corporate finance department. Ms. Chen also spent three years in Morgan Stanley's M&A department in New York and Hong Kong. She holds a B.A. degree in economics from Berkeley and an MBA in finance from Wharton. She is also a frequent guest on both CNBC and Bloomberg TV. Her current coverage universe is: ANF, AEO, ARO, BEBE, COH, GES, GPS, HOTT, JCG, PSUN, RL, TRLG, URBN, VLCM.
TWST: Is expansion going on at all or is it kind of static as everybody pulls back their horns a little bit?
Ms. Chen: There are a few good growth names out there. Urban Outfitters (URBN) is probably the best example of that. They have Urban Outfitters, which caters to teen. They have Anthropologie, which caters to the contemporary customer as well as Free People, all which are still opening stores. The company is taking a little bit longer to open them because lease terms can be better if you take longer to negotiate the leases. But the company has a very small footprint, so they are still embarking on their path of growth and getting some pretty good terms at this point.
TWST: And in general, are retailers getting good deals from the mall operators?
Ms. Chen: That seems to be the general consensus - that rents are coming down.
TWST: Looking at the teen retailers, anything hot at this point that's driving business or is it just a preponderance of teens?
Ms. Chen: Teen was one of the last to be hurt by the economic slowdown and it might be counterintuitive, but teen could be one of the first to come out of it. One of the biggest reasons is product. In the teen space, there is emerging a uniform, so to speak. There are a lot of key must-have fashion items that are popping up for back-to-school, which you really didn't have last year. Last year you had a ton of fashion, but there wasn't a handful of peer-pressure type items, as I like to call them. This year, you have the boyfriend blazer, you have the boyfriend jean, you have the plaid shirt. Hopefully you won't wear them all together in one outfit, but they are very good updates to items that you might already have in your wardrobe. Last year, you really didn't have these key items. While back-to-school will be later this year because of calendar shift and the tax-free holiday shift, the kids will go back to school, see what their peers are wearing and run back into the stores and buy similar items.
TWST: Even in tough times, kids are fashion conscious?
Ms. Chen: They are and there is a practical element too, as kids are growing so they may not be able to fit into the clothes that they wore last year.
TWST: One of the joys of having teenagers is constant wardrobe replenishment.
Ms. Chen: Exactly.
CHRISTINE CHEN
Principal & Senior Research Analyst
Needham & Company, LLC
The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 52 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .
The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.
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