65.05 -0.17 (-0.26%)
Pre-Market: 9:07AM EST
|Bid||65.10 x 2200|
|Ask||65.45 x 1000|
|Day's Range||65.07 - 66.29|
|52 Week Range||57.89 - 83.28|
|Beta (3Y Monthly)||0.64|
|PE Ratio (TTM)||10.86|
|Earnings Date||Mar 5, 2019|
|Forward Dividend & Yield||2.44 (3.68%)|
|1y Target Est||73.94|
What’s Expected for Macy’s Fourth-Quarter Results(Continued from Prior Part)Forward PE multiples As of February 20, Macy’s (M) 12-month forward PE multiple was 7.6x, 12.3% lower than when it announced its lowered outlook for fiscal 20181 on
Macy's (M) shares slipped 2.3% Thursday to help extend its 2019 downturn that runs counter to the broader market's resurgence. The question now is does Macy's fall signal that investors are worried about the company's fourth-quarter earnings results?
There are plenty of reasons to buy Kohl's Corp. It's a department store that would like to see online sales catch up in what is becoming a crowded e-commerce market place. Kohl's is currently trading at $65.99 a share, and the average price target from sell-side analysts on Wall Street is $74.65, representing upside of 13%.
What’s Expected for Macy’s Fourth-Quarter ResultsUpcoming fourth-quarter resultsDepartment store chain Macy’s (M) is set to announce its fiscal 2018 fourth-quarter1 results on February 26. Analysts expect the company’s sales and EPS to fall
Kohls Corp NYSE:KSSView full report here! Summary * Perception of the company's creditworthiness is neutral * ETFs holding this stock have seen outflows over the last one-month * Bearish sentiment is moderate Bearish sentimentShort interest | PositiveShort interest is moderate for KSS with between 5 and 10% of shares outstanding currently on loan. The last change in the short interest score occurred more than 1 month ago and implies that there has been little change in sentiment among investors who seek to profit from falling equity prices. Money flowETF/Index ownership | NegativeETF activity is negative. Over the last one-month, outflows of investor capital in ETFs holding KSS totaled $12.59 billion. Additionally, the rate of outflows appears to be accelerating. Economic sentimentPMI by IHS Markit | NeutralAccording to the latest IHS Markit Purchasing Managers' Index (PMI) data, output in the Consumer Services sector is rising. The rate of growth is weak relative to the trend shown over the past year, however. Credit worthinessCredit default swap | NeutralThe current level displays a neutral indicator.Please send all inquiries related to the report to firstname.lastname@example.org.Charts and report PDFs will only be available for 30 days after publishing.This document has been produced for information purposes only and is not to be relied upon or as construed as investment advice. To the fullest extent permitted by law, IHS Markit disclaims any responsibility or liability, whether in contract, tort (including, without limitation, negligence), equity or otherwise, for any loss or damage arising from any reliance on or the use of this material in any way. Please view the full legal disclaimer and methodology information on pages 2-3 of the full report.
Under Armour (NYSE:UA, NYSE:UAA) shares moved higher after the company's earnings report on Feb. 12. Both classes of Under Armour stock gained. As of this writing, UA shares are up 6% and UAA stock is higher by 7.4%. Click to Enlarge Source: Shutterstock The divergence in performance adds to the long-running -- and still unexplained -- valuation gap between UA and UAA shares. But the fact that both classes of Under Armour stock have rallied itself is odd. Q4 earnings were solid, admittedly. But guidance for 2019, which should matter more to a forward-looking market, was left unchanged.With UAA stock already up 18% before earnings, the report hardly seems strong enough for more upside. And it leaves Under Armour stock, which I thought was a sell in December, in a precarious position going forward.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Under Armour Stock Rises After EarningsIn terms of expectations, Under Armour earnings admittedly look solid. Adjusted earnings-per-share of 9 cents was 5 cents better than consensus of 4 cents, and a noted improvement from a breakeven performance the year before. Revenue rose 1.5% to $1.39 billion, about $10 million ahead of the Street. * The 7 Best Video Game Stocks to Power Up Your Portfolio! Expectations aside, however, the performance is hardly impressive. Sales in North America dropped 6% year-over-year in Q4, driving a full-year 2% decline in that market. Given that Nike (NYSE:NKE) has executed a dramatic reversal in its North American business, Under Armour is clearly losing share domestically. Questions persist surrounding the company's retail strategy of selling full-price at outlets like Dick's Sporting Goods (NYSE:DKS) and at a discount at Kohl's (NYSE:KSS).There is good news, admittedly. International sales continue to grow nicely. Those markets -- now about a quarter of total revenue -- are key to the long-term strategy. And Under Armour is recovering some of the margins it has lost in recent years, with its adjusted gross margin up 160 bps in Q4.Bulls, then, can argue that Under Armour's turnaround is progressing. That's actually true. But to at least some extent that's already priced in. And looking at guidance for 2019, it's a surprise that Under Armour stock has continued to rally. Guidance and UAA StockAt its Investor Day in December, Under Armour laid out five-year targets for its turnaround. The market wasn't impressed. Under Armour stock had already fallen heading into the report, and it continued plunging afterward. The two declines combined led Under Armour stock down 30% in less than three weeks.Obviously, broad market weakness in December didn't help. But even considering a notable change in sentiment for the market as a whole, the rally in UAA stock on Wednesday made little sense. The stock already had recaptured much of those losses, but little changed in the story on Wednesday looking forward. The 2019 outlook was reaffirmed. Under Armour still sees EPS of just 31 cents to 33 cents this year, implying a 67x price-to-earnings ratio (on the high-end of guidance) for UAA stock.That single metric doesn't make Under Armour stock a sell. But the rally of the past few weeks does seem confusing and potentially unsustainable. It was the long-term outlook in December that spooked investors. That outlook suggests something like $1 in EPS in 2023. Yet UAA stock now trades at 22x that long-term figure. * The 3 Best Chinese Stocks to Buy for a Long-Term Portfolio More notably, UAA now has recaptured all of the post-Investor Day selloff. That seems like too much. Luke Lango wrote at the time that the outlook confirmed that $20 was too much to pay for UAA stock. The stock now is over $22. What drives more upside? The Risks to UA and UAAThe aggressive move in UA and UAA of late creates two key risks. The first is that in 2019, Under Armour now has to outperform. If five-year targets weren't enough in December, and they haven't changed since, then investors are pricing in better-than-expected results. Any quarter going forward that isn't a big beat is likely to lead to a selloff in Under Armour stock.The second risk is that UAA stock also looks reliant on broad market trends. What is now a 26% rally year-to-date is coming solely from the fact that investors are more bullish in 2019 then they were at the end of 2018. When that bullishness fades -- or again reverses -- UAA will be left in a precarious position.Again, this is not to say that there's no good news in Under Armour earnings. The turnaround is on track. International sales and margin expansion are key parts of the story.But this is also a company losing market share in North America, where revenues in 2019 are expected to be flat and its stock is trading at 60x+ 2019 earnings. A turnaround of some kind is already priced in. From these levels, for UAA to gain, the progress needs to accelerate. And it's not clear why investors see the Q4 report as evidence that acceleration is on the way.As of this writing, Vince Martin did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks That Every 20-Year-Old Should Buy * 10 Best Dividend Stocks to Buy for the Next 10 Months * 10 Monster Growth Stocks to Buy for 2019 and Beyond Compare Brokers The post Under Armour Stock Rallies After Earnings … But Why? appeared first on InvestorPlace.
J.C. Penney's decision to no longer sell appliances is another red flag tossed for the struggling retailer's doorstep.
Why JCPenney Is Pulling Appliances from Its StoresJCPenney to stop selling appliances JCPenney (JCP) will stop selling major appliances at its stores starting at the end of February. The mid-tier department store chain will also reduce its exposure
Kohl's (KSS) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.
In a statement, Vaca said she was proud of the board’s work in appointing Michelle Gass as one of the few women chief executive officers of a public company.
The iconic department store company has too much space in most of its stores, exacerbating long-running inventory management problems.
With fashion trends changing faster than ever, aided by social media’s influence on viral fashion, Cowen analyst John Kernan said he views improved speed in the form of design time and supply chain as a catalyst to lead to less working capital risk, higher merchandise margins and higher valuations. “We’re working with Foot Locker to create incredible product for consumers and deliver it faster than ever before,” said Zion Armstrong, president of adidas North America.
Macy’s and Nordstrom: Do Analysts Expect Improvement in 2019?Stock movement in JanuaryThe stocks of major department stores are in the red after reporting weak holiday sales numbers earlier this month. As of January 29, stocks of Macy’s (M) and
Kohl’s (KSS) today announced it will donate a total of $500,000 in grants to 22 local nonprofit organizations that improve the quality of life for children and families through the Kohl’s Hometown Giving Program. Launched in 2017, the Kohl’s Hometown Giving Program allows Kohl’s to broaden its support of incredible organizations that make a difference in the Milwaukee community in addition to its ongoing hometown partners. Since the program’s inception, Kohl’s has donated more than $1 million to 50 nonprofit organizations in the Milwaukee area.
The retailer hopes to drive more traffic to its stores and bolster its health and wellness credentials through a new partnership with WW.
Kohl's said it's teaming with Weight Watchers to offer wellness products and open a new Chicago wellness center.
The case for buying Target (NYSE:TGT) stock at current levels is reasonably simple. Target stock is cheap, as TGT stock trades at less than 13 times analysts' consensus 2020 earnings estimate. That's a historically low multiple for TGT and one that looks relatively muted in the context of the industry. Indeed, rival Walmart (NYSE:WMT) trades at a full 20 times next year's consensus earnings-per-share estimate. Yet TGT stock is priced much closer to low-growth department store plays like Kohl's (NYSE:KSS) and Nordstrom (NYSE:JWN), each of whom trade at similar 12x-13x P/E ratios. Given that Target's comparable sales should rise 5% this year, based on the Q4 guidance that it updated earlier this month, Target stock simply looks too cheap. While Kohl's and Macy's (NYSE:M) reported disappointing holiday results, Target posted an excellent performance. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Stocks to Sell in February And it would seem that Target's omnichannel initiatives have put it back on track, leaving it poised to deliver more growth in fiscal 2019 (which ends in January 2020) and beyond. But I've long been a skeptic when it comes to Target stock and truthfully, I still am. The company's FY18 performance was impressive, particularly on the top line. But its profits have remained weak, as its margins are being pressured by its omnichannel efforts. In other words, Target is buying some of that revenue growth, while also benefiting from easier comparisons. The easier comparisons will end in fiscal 2019, but the elevated spending won't. And with Target still behind Walmart and still facing years of pressure from Amazon.com (NASDAQ:AMZN) and other online pure-plays, investors shouldn't expect TGT to grow too rapidly. Thus, the valuation of Target stock shouldn't be as high as it is. ### Q3, Q4, and TGT Stock I wrote ahead of Target's Q3 earnings report in November that the results were important for Target stock. Most notably, Q3 ended a string of easy one- and two-year comparisons from a sales and profit standpoint. Adjusted EPS didn't move much in the two prior years -- it came in at $4.69 in fiscal 2015, and $4.17 in fiscal 2017 - and the company's operating income and margins declined over that period. Target's growth in its first three quarters looked impressive, but they benefited from comparisons to its weaker performance in prior periods. As a result, Q3, the last quarter in which Target had a truly easy comparison, needed to look hugely impressive to show that TGT was on the right track. Simply put, the Q3 results weren't that impressive. Target missed the consensus estimates, and TGT stock, which came under added pressure from the nervous stock market, plunged, Target stock subsequently lost 30% of its value in about seven weeks. TGT now has bounced 20% off those December lows, partly because its Q4 outlook has improved, as same-store sales growth in the range of 5% is better than pretty much everyone else in the space. And that's on top of a 3.6% increase in the prior year. Because of the easy Q3 comparisons, if an investor wants to turn bullish on TGT stock ahead of fiscal 2019, Q4 is more important than Q3. And as skeptical as I am, I do think that the company's Q4 results could be good. Still, looking forward, I'm not sure that Target stock is nearly as cheap as it looks. ### My Concerns About Target Stock I have several broad concerns about TGT, which echo my worries about the retail sector as a whole. First, Target's earnings growth - even after factoring in its improved FY18 results - is close to zero. The company's FY18 EPS should come in at $5.30-$5.50, versus the $4.69 it posted three years ago. But basically all of that increase will come from a lower tax rate. The effective tax rate in FY15 was 32.5%; it should be closer to 19% on an adjusted basis this year. Pre-tax earnings per share actually have declined over that stretch, and they look poised to drop again in fiscal 2019. The declines are a direct result of the second issue: omnichannel retailing isn't cheap. Target and Walmart (and others) are rolling out myriad ways to shop, and all those options cost money to launch and support. And the razor-thin margins in retail (Target's operating margins are under 6%) don't leave a lot of room for extra costs. Target is driving sales growth by making shoppers' lives easier, but it's paying significantly for that growth. And while Target's sales growth seems impressive, it should be impressive. It is, after all, a retailer in the tenth year of an economic expansion. Target's performance ought to be good right now because it's not going to be great when the macro cycle eventually turns. So if Target can't grow its earnings in this environment, when will it be able to do so? ### Why You Should Avoid TGT Stock So, yes, TGT stock is cheap. But there are good reasons why it's cheap. Target isn't a leader of the retail sector. Most of its investments of late have been reactive, not proactive. And they're being duplicated by most of the company's competitors, including Walmart. It's possible that Target's results will be boosted in the next few years by the demise of a number of its competitor. (The bankruptcy of Sears Holdings (OTCMKTS:SHLDQ) definitely will be a tailwind for TGT stock.) Target's spending growth should moderate over time. And 13 times EPS isn't a terrible price for TGT stock. But in the context of the cyclical situation and margin pressures, its valuation is not compelling, either. And it's tough to see a catalyst on the horizon. Strong Q4 results are likely priced into the stock after its recent bounce, and its FY19 guidance probably won't differ much from the consensus outlook. I'd be loath to own TGT stock into its earnings report, given the current agitation of the stock market. Target's valuation isn't low because the market hasn't been paying attention to TGT. Rather, investors are looking at what's in store for Target. And it will have some challenges ahead, with the macro cycle destined to turn at some point, its spending likely to continue to be elevated, and its comparisons becoming quite difficult this year. From that standpoint, TGT stock is cheap, but it's cheap for a number of good reasons. As of this writing, Vince Martin has no positions in any securities mentioned. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Smart Money Stocks to Buy for the Rest of the Year * 10 Best Consumer Stocks to Buy in 2019 * 10 Triple-A Stocks to Buy in February Compare Brokers The post Target Stock Doesn't Look Cheap Enough appeared first on InvestorPlace.
Jan Kniffen, CEO of JRogers Kniffen Worldwide, joins "Squawk Box" to give his expectations for the retail earnings that are coming up next week.