Market Overview

7 Stocks Maxim Is Watching In Retail

Share:
Related KSS
We Must Protect This House: Kohl's Hoping Under Armour Launch Will Offset Mounting Headwinds
Retailers' Earnings On Parade: How Do Nordstrom, JCPenney Stack Up?
J.C. Penney: Trying To Sell Its Turnaround Story (Seeking Alpha)
Related KORS
Will Sequins Once More Grace This Weekend's Red Carpet?
Michael Kors, Coach Potential Suitors In Kate Spade Buyout
Investing In IPO Stocks: How Should You Handle Snapchat's Market Debut? (Investor's Business Daily)

In a report published Monday, Maxim Group analyst Rick Snyder maintained a Hold rating on six of the seven companies being discussed in the retail sector. The only company with a Buy rating was Kohl's Corp (NYSE: KSS), with a price target of $77.

In the report Maxim Group noted, "Again this week, Kohl's appeared to be sitting on the promotional sidelines. We mentioned last week that the department store seemed to be less promotional recently, offering no meaningful online site-wide or storewide promotions immediately applicable to every shopper. The same was true this week. Its junior apparel & accessories promotion also ended as planned."

Snyder maintained a Hold rating on Michael Kors Holdings Limited (NYSE: KORS) ($65.00 PT), The Children's Place Inc (NASDAQ: PLCE) ($51.00 PT), Chico's FAS Inc (NYSE: CHS) ($14.50 PT), Ralph Lauren Corp (NYSE: RL) ($130.00 PT), Aéropostale Inc (NYSE: ARO) and Macy's, Inc (NYSE: M) ($60.00 PT).

"Online at Michael Kors, the company was still notifying customers of shipping delays due to the damage to its online fulfillment center in Ohio, which we first mentioned last Sunday," the analyst said.

Mentions of free shipping and return policy have been removed from the home page of Kors' website. In fact, channel checks indicate that Kors would be able to ship online orders only after April 1. "We expect the impact of this damage to be material," Snyder highlighted.

"Like last year, The Children's Place "extended" its 30% off everything Friends & Family event for an additional day, so the event ran the same number of days. However, if customers missed the event last week, they enjoyed a 25% savings pass for this weekend."

"Chico's offered "BOGO 50% Off" full-priced styles in store and online this week, in addition to an extra 30% off already-reduced styles and its rewards card promotion. We note Chico's promotional stance last week and our belief that the brand is not currently comping positively, as opposed to White House Black Market and Soma (which we believe are comping positively)."

Ralph Lauren planned a bounce back promotion for the US, which featured a more valuable gift card, redeemable through May 3. This promotion ended as planned. Ralph Lauren had run a similar promotion in February, with cards redeemable through April 12. "While we believe that Ralph Lauren's core businesses remain strong, we remain concerned about traffic at full-price and outlet locations, as well as FX impacts, as we mentioned last week."

Aéropostale is running advertisements online showcasing the new collection of its men's United XXVI label. There has been a steady decline in the number of markdowns over the past month. "We do expect gross margin expansion in Q1 but would like to see woman's, which accounts for approximately 65% of Aéropostale sales, to improve," Snyder added.

Macy's was more promotional this week as compared to the same week last year. Even at the Bloomingdale's stores, the promotions were higher than the same period last year.

Latest Ratings for KSS

DateFirmActionFromTo
Feb 2017SusquehannaInitiates Coverage OnNeutral
Jan 2017Credit SuisseDowngradesNeutralUnderperform
Jan 2017Telsey Advisory GroupDowngradesOutperformMarket Perform

View More Analyst Ratings for KSS
View the Latest Analyst Ratings

Posted-In: Maxim GroupAnalyst Color Reiteration Analyst Ratings

 

Related Articles (ARO + CHS)

View Comments and Join the Discussion!