March retail same store sales were weak, outside of discounters. Remember companies and analysts have been aggressively taking down first quarter estimates for over a month (as well as same store sales), but companies like JC Penney,Target,Gap,Abercrombie, and Kohls were all notably below expectations on same store sales.
As for earnings, while Wal-Mart boosted guidance, that has been the exception in retail land. Since JC Penney guided down a couple weeks ago, the guidance has been almost unanimously to the downside. Today, for example:
1) Kohls guided Q1 down (to $0.40-$0.42, the consensus was $0.50);
2) Rite Aid gave guidance for fiscal 2009 below expectations (loss of $0.34-$0.48 vs. loss of $0.15);
3) Stage Stores said first quarter would be below expectations (loss of $0.05-$0.08, vs. previous guidance of a gain of $0.13);
4) American Eaglesaid earnings would be below previous guidance ($0.18-$0.20 vs. previous guidance of $0.25-$0.27).
Is there any good news here? Yes, because the Street has been so unrelentingly bearish retail stocks are barely off their January lows; no rally means that the downside is somewhat limited. I expect retailers to be mostly flat to slightly up today because there may be some short-covering in this heavily shorted group.
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