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Barnes & Noble (BKS) Blames Elections for Comps Decline
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Shares of U.S. bookstore chain operator Barnes & Noble, Inc. fell 4.1% yesterday, as management slashed its fiscal 2017 comparable store sales (comps) outlook during the announcement of first-quarter results. The company cited the upcoming elections as the reason for the expected decline in comps.
Reasons for Comps Decline
The bookseller projects a low single-digit percentage decline in its comps for fiscal 2017. Earlier, the company had projected comps to remain flat or rise by up to 1%.
The company holds the upcoming U.S. elections responsible for the expected comps decline as Americans prefer to stay indoors to follow the elections coverage. Evidently, the elections have been infusing fear, anger and frustration among the public, keeping them at home.
However, the elections are not the only reason behind the comps decline. The company stated in its conference call that softer-than-expected sales results to date and the expected continuation of the challenging retail environment led to the decline.
In fact, the company has been facing several challenges of late. Sales at Barnes & Noble's brick-and-mortar stores have been sliding due to stiff competition from Amazon.com Inc. (AMZN - Free Report) and other online players as shoppers increasingly shift to the internet for cheaper offerings and convenience.
Also, the company’s decision to reduce inventory went wrong and therefore, it had to cut expenses in the worst areas, mainly retail floor personnel. Thereafter, its Nook business, which includes digital content, devices and accessories, continued to decline, with sales down 25% in the first quarter.
Barnes & Noble reported disappointing first-quarter fiscal 2017 results on Sep 8, wherein its sales slumped 6.6% to $913.9 million due to a decline in comps. Comps slipped 6% on lower store traffic. Book sales caused the majority of the comps decline. Sales also significantly lagged the Zacks Consensus Estimate of $960 million.
Adjusted net loss per share, however, narrowed to 7 cents per share from 27 cents recorded a year ago due to lower costs. It was also narrower than the Zacks Consensus Estimate of a loss of 9 cents per share.
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Barnes & Noble (BKS) Blames Elections for Comps Decline
Shares of U.S. bookstore chain operator Barnes & Noble, Inc. fell 4.1% yesterday, as management slashed its fiscal 2017 comparable store sales (comps) outlook during the announcement of first-quarter results. The company cited the upcoming elections as the reason for the expected decline in comps.
Reasons for Comps Decline
The bookseller projects a low single-digit percentage decline in its comps for fiscal 2017. Earlier, the company had projected comps to remain flat or rise by up to 1%.
The company holds the upcoming U.S. elections responsible for the expected comps decline as Americans prefer to stay indoors to follow the elections coverage. Evidently, the elections have been infusing fear, anger and frustration among the public, keeping them at home.
However, the elections are not the only reason behind the comps decline. The company stated in its conference call that softer-than-expected sales results to date and the expected continuation of the challenging retail environment led to the decline.
In fact, the company has been facing several challenges of late. Sales at Barnes & Noble's brick-and-mortar stores have been sliding due to stiff competition from Amazon.com Inc. (AMZN - Free Report) and other online players as shoppers increasingly shift to the internet for cheaper offerings and convenience.
Also, the company’s decision to reduce inventory went wrong and therefore, it had to cut expenses in the worst areas, mainly retail floor personnel. Thereafter, its Nook business, which includes digital content, devices and accessories, continued to decline, with sales down 25% in the first quarter.
BARNES & NOBLE Price and Consensus
BARNES & NOBLE Price and Consensus | BARNES & NOBLE Quote
Sluggish Q1 Results
Barnes & Noble reported disappointing first-quarter fiscal 2017 results on Sep 8, wherein its sales slumped 6.6% to $913.9 million due to a decline in comps. Comps slipped 6% on lower store traffic. Book sales caused the majority of the comps decline. Sales also significantly lagged the Zacks Consensus Estimate of $960 million.
Adjusted net loss per share, however, narrowed to 7 cents per share from 27 cents recorded a year ago due to lower costs. It was also narrower than the Zacks Consensus Estimate of a loss of 9 cents per share.
Barnes & Noble carries a Zacks Rank #3 (Hold).
Stocks to Consider
Better-ranked stocks in the same industry include Big 5 Sporting Goods Corp. (BGFV - Free Report) and Five Below, Inc. (FIVE - Free Report) . Both these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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