These Analysts Went Shopping At Teen Retailers; Here's What They Saw

In a report published Tuesday, BMO Capital Markets analyst John Morris and a field team visited shopping malls to gain a first hand account of selling trends at teen retailers during the key spring break weeks.

Related Link: Will Aeropostale Be The Next Bankrupt Teen Retailer?

Here is a summary of what was observed:

• Abercrombie & Fitch Co. ANF checks showed a weak business due to several headwinds including the overhand from logo abatement. Stores were over-assorted, leading to customer confusion, while lacking the necessary inventory depth behind key items.
• American Eagle Outfitters AEO checks showed a significant merchandise improvement in the women's tops category. The checks also showed solid trends in bottoms and "athleisure" wear. Men's denim was more attractive, driven by new washes and silhouettes.
• Childrens Place Inc's PLCE checks concluded that promotional activity remained in line with last year while categories including baby and denim had an improved offering with products that are sold in a set of two or three items.
• Express, Inc. EXPR checks showed less semi-annual sale clearance items compared to a year ago, but did run a 40 percent off promotion over Easter. However, the checks indicated strength in product assortment from tops to leggings and casual bottoms to boho and western trends.
• Gap Inc GPS checks pointed towards notable weakness in dresses and tops while bottoms were somewhat better. The analyst noted that major improvements in the product line are not expected until holiday 2015, with full reflection coming only in spring 2016.
• L Brands Inc LB's Victoria Secret checks pointed towards favorable reads with PINK experiencing strong trends. Bath & Body Works checks showed solid traffic with no discernible push-back to subtle price increases taken over the last month.
• Urban Outfitters, Inc. URBN checks showed an improvement in tops and dresses but were offset by ongoing weakness in bottoms, albeit modestly improved from fourth quarter checks.