The Buckle Inc. (BKE) reported net sales of $79.4 million in June 2012, down 0.3% from $79.6 million in the comparable month last year. The company’s comparable store sales (comps) fell 2.5% in the reported month. The Men’s segment performed better than the Women’s. The market is currently facing fears of faltering consumer confidence as is evident by lower consumer retail spending. Even planned promotional offers failed to lift Buckle’s comps.
Total sales for the Men’s side of business nudged up 2.0% year over year and represented 44.0% of total sales for the month. Sales from the Women’s side of business accounted for 56% of total sales but slipped 1.5% year over year.
Pricing in the Women's segment was slightly lower than the Men’s. Overall pricing was up 3.5% in the Women’s segment while the Men’s segment saw a 4.0% increment. Average accessory price points were up about 16% and average footwear price points were up approximately 10.5% in the month.
In June, the categories that performed well were denim, active apparel, casual bottoms, woven tops, footwear and accessories. Accessory sales for Men's and Women's categories together saw a sudden surge of approximately 16% year over year while the footwear business stepped up around 6.5%. These two categories generated approximately 11.0% and 6.0% of net sales for June. The contributions were higher than the year-ago levels of 9.5% and 5.5% for accessory and footwear respectively.
The poor retail performance resulted in a decline in the Zacks Consensus earnings estimate for Buckle’s upcoming second quarter to 51 cents, down by a penny over the last 7 days. A pessimistic outlook is prevailing around the stock. Of the eight analysts covering the stock, two cut their estimates for the upcoming quarter and one out of nine analysts lowered the same for the fiscal year to reflect the ongoing challenges. No single analyst went for an upward estimate revision over the last 7 days.
The company ended June with 435 retail stores in 43 states compared with 424 stores in 41 states as of July 5, 2011. Buckle, which mainly caters to older teens and young adults, currently retains a Zacks #3 Rank that translates into a short-term Hold rating. We are maintaining our long-term Neutral recommendation on the stock. One of its competitors, Cato Corp. (CATO) reported a 7.0% downside in total sales as well as a 10.0% plunge in same-store sales in June.
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