Consumer won't save luxury retail: Experts

Parsing August's retail gain

Despite solid signs for consumer spending, luxury retail stocks will likely continue to struggle, two experts said Tuesday.

"I still think that luxury has a bit of a shakeout left to go here," said Stacey Widlitz, president of SW Retail Advisors and a CNBC contributor, in a "Power Lunch" interview.

Retail sales excluding automobiles, gasoline, building materials and food services increased 0.4 percent in August after an upwardly revised 0.6 percent in July, the Commerce Department said Tuesday. But the solid reading may not lift sagging sales at high-end chains, experts said.

A Costco store in Alhambra, Calif.
Frederic J. Brown | AFP | Getty Images

Notable luxury stocks have taken a beating this year, with Michael Kors and Tiffany falling nearly 42 and 25 percent, respectively. Investors in retail can instead look to names like Victoria's Secret owner L Brands and warehouse store Costco amid a tough run for the sector, Widlitz said.

"Those are two places in a rough tape as we go into holiday that you could definitely look to," she said.

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American Eagle Outfitters, which has fallen 15 percent in the last month, also looks attractive on weakness, added Rick Snyder, an analyst at Odeon Capital.