August delivered some mixed numbers for retailers Buckle Inc BKE, Gap Inc GPS and L Brands Inc LB. In a new report, Wedbush analyst Morry Brown discussed August sales numbers for the three retailers.
In terms of same-store sales (SSS), L Brands came in slightly ahead of expectations for the month, while Gap fell slightly below expectations. Buckle, on the other hand, reported a -14.8 percent comp in August, well short of consensus expectations of -8.8 percent.
“We believe the shift in fashion away from embellishment-heavy items (higher AUR) toward simple styles (lower AUR) will continue to pressure top and bottom line results,” Brown said of Buckle.
In light of the disappointing numbers, Wedbush dialed back its 2016/2017/2018 EPS estimates for Buckle from $2.45/$2.46/$2.47 to $2.33/$2.32/$2.33. In addition, the firm lowered its price target for the stock from $22 to $21.
Brown also noted that the new price target for Buckle represents only a 9x multiple on forward 24-month EPS projections because of the company’s slowing sales trends and margin uncertainty.
Wedbush maintains its $25 price target for Gap and its $65 price target for L Brands and did not adjust earnings estimates through 2018. The firm has a Neutral rating on all three stocks.
Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
