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Wedbush's Favorite Retail Stocks, Despite 'Poor Start' To Earnings

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Wedbush's Favorite Retail Stocks, Despite 'Poor Start' To Earnings
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In a new report, analysts at Wedbush took a look at softline retailers. With earnings in the space weak so far, analysts believe that expectations are extremely low for the companies that have yet to report. The report includes Wedbush’s top three stocks to buy before earnings.

Lowering The Bar

Of the 10 retailers that have reported so far, nine of the stocks have fallen following their respective reports. The disappointment has produced an average downside of 4.6 percent for shareholders. However, analysts believe the risk to the stocks that have yet to report will be limited.

“While the market appears to have taken the approach of selling first and asking questions later in response to softening top-line reports, we believe that the magnitude of risk is likely reduced going forward, at least for those retailers that manage to meet or exceed consensus sales expectations,” analysts explain.

Related Link: Big-Box Retailers Step Into The Spotlight For Earnings This Week

'Solid Beat' From Express?

Analysts believe that Express, Inc. (NYSE: EXPR) is set up well for an earnings beat based on strong store checks throughout the quarter. In addition, analysts believe that off-price department stores will continue to outperform the broader retail segment.

Stock Picks

Wedbush has Outperform ratings on the stocks of Express, Ross Stores, Inc. (NASDAQ: ROST) and the TJX Companies Inc (NYSE: TJX) ahead of earnings.

Wedbush has Hold ratings on ANN Inc (NYSE: ANN), Buckle Inc (NYSE: BKE), Chico’s FAS, Inc. (NYSE: CHS), Gap Inc (NYSE: GPS), Michael Kors Holdings Limited (NYSE: KORS), L Brands Inc (NYSE: LB), Urban Outfitters, Inc. (NASDAQ: URBN) and Zumiez Inc. (NASDAQ: ZUMZ).

Latest Ratings for EXPR

DateFirmActionFromTo
Aug 2016UBSDowngradesNeutralSell
Aug 2016BMO CapitalMaintainsMarket Perform
Aug 2016MKM PartnersMaintainsNeutral

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Posted-In: WedbsuhAnalyst Color Analyst Ratings Best of Benzinga

 

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