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Macy’s and Nordstrom’s Earnings Disappoint

Mark Jonker

Retail Sales and Earnings Drag Consumer Discretionary ETFs

(Continued from Prior Part)

Earnings released last week

The week ending November 13, 2015, saw earnings releases from some major retailers in the United States. Standouts were Macy’s (M) and Nordstrom (JWN), both which gave a negative outlook for the consumer discretionary sector.

Macy’s saw its earnings dip 8.2% on a YoY (year-over-year) basis, whereas Nordstrom saw its earnings fall by a whopping 43% from last year.

Amid fears of falling consumer spending, J.C. Penney Company (JCP) and Kohl’s (KSS) surprised Wall Street by reporting higher-than-expected earnings but still saw their stocks fall. Investors have become pessimistic about the consumer discretionary sector (XRT).

Earnings to look forward to in the upcoming week

The coming week is lined up with the earnings releases of some prominent retailers in the United States. Investors will have a keen interest in the results.

Analysts’ consensus recommendations for the stocks

  1. TJX Companies (TJX) stock has a consensus “buy” rating and a target price of $81.38 in the next 12 months, with a return of 26.7%.
  2. Urban Outfitters (URBN) stock has a consensus “hold” rating and a target price of $36.74 in the next 12 months, with a return of 50%.
  3. L Brands (LB) stock has a consensus “hold” rating and a target price of $101.07 in the next 12 months, with a return of 11.6%.
  4. Staples (SPLS) stock has a consensus “hold” rating and a target price of $18.18 in the next 12 months, with a return of 44.3%.
  5. Target (TGT) stock has a consensus “hold” rating and a target price of $84.82 in the next 12 months, with a return of 18.9%.
  6. The Gap (GPS) stock has a consensus “hold” rating and a target price of $28.99 in the next 12 months, with a return of 14.9%.
  7. Ross Stores (ROST) stock has a consensus “hold” rating and a target price of $55.16 in the next 12 months, with a return of 11.2%.
  8. Best Buy (BBY) stock has a consensus “buy” rating and a target price of $40.68 in the next 12 months, with a return of 27.0%.
  9. Dollar Tree (DLTR) stock has a consensus “buy” rating and a target price of $79.70 in the next 12 months, with a return of 28.1%.

In the next article, we’ll have a look at the Michigan Sentiment Index, which brought some positive news for investors.

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