July SSS Targets Missed By Most Retailers; Few Shine

Traditionally, the back-to-school shopping season starts with July, making it the second busiest shopping time of the year. However, the sales results from retailers for the month this year has came across as poor as consumers spending remained on leash due to uncertain employment outlook. Consumers are also worried about slowing economic recovery. Barring a few exceptions, retailers failed to meet the sales expectations. The results were especially bad from teen retailers as parents and teens seem to be holding off purchases until later in the summer. Retailers commented that although the malls received footfalls, shoppers were cautious in their approach towards shopping. The retailers that reported better-than-anticipated performance included Gap GAP, Macy's M, Zumiez ZUMZ and Limited Brands LTD, which reported 12% same-store sales as against the expectations of 5.2%. Meanwhile, discounters such as Target TGT, Aeropostale ARO and JC Penney JCP fell short of the Street view. Other stores that missed the targets were Hot Topic HOTT, The Buckle BKE and Wet Seal WTSLA. While HOTT’s SSS declined 9.4% versus the expectations of a decline of 2.6%, WTSLA’s SSS declined 4.3% as against a decline of 3.4%. Following the July's performance, both JCP and ARO said that their second-quarter earnings may come in at the low end of their prior guidance. Meanwhile, HOTT has widened its earnings expectations for a loss of $0.14 a share for the quarter, from the previous projections of a loss of $0.07-$0.10 a share. Read more from Benzinga's Markets.