Retailer's Surprise: Lower Guidance
September comparable retail sales were generally lower than expected, even after numbers were lowered in the last week. Apparel companies like Limited,Chico's, Abercrombie, Gap and Limited missed, but so did Target, as did the department stores like Saks and Nordstrom.
But the big standout are the large number of companies lowering guidance.
Lowering guidance: Men's Warehouse, American Eagle, Target, Limited, Nordstrom, JC Penney. Kohl's said earnings would be at the low end of the range. The biggest surprises were Nordstrom and JC Penney. Nordstrom saw an increase in sales, but less than expected. The company lowered its guidance for the quarter: down 6% pre-open.
JC Penney missed expectations, citing the weather and housing-related issues, and notably lowered their guidance for the quarter (which ends in October), to $1.00-$1.04 from $1.28. down 5% pre-open.
Wal-Mart actually missed sales estimates for September, but raised guidance, but it wasn't because of positive sales momentum, they're doing what they do best: cutting costs (read: squeezing suppliers). Upward guidance means Wal-Mart up 3% pre open, but slower sales momentum is an issue.
The good news: a cold snap in October should send buyers back into stores for those sweater.