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L Brands' (LB) Sluggish Comparable Sales Run Continues
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L Brands, Inc. witnessed a decline in comparable sales (comps) for the fifth consecutive month as the company reported April sales numbers. This specialty retailer of women’s intimate and other apparel, beauty and personal care products posted 5% decline in comps for the four-week ended Apr 29 after registering a decline of 10%,13%, 4% and 1% in March, February, January and December, respectively. Moreover, net sales for April dipped 2% to $719.6 billion.
Late Easter holiday positively impacted the company’s April comps by nearly 3%. However, the exit from the swim and apparel categories had a 6 percentage points and 10 percentage points adverse impact on overall company and Victoria’s Secret comparable sales, respectively.
Dismal comps performances in the past five months have hurt the company’s shares. We noted that the stock has plunged 23.2% in the past six months, compared with the Zacks categorized Retail-Apparel/Shoe industry’s decline of 12.6%.
The company stated that merchandise margin rate increased in April, in comparison with the prior year.
Further, the company also reported first-quarter 2017 sales number. In the first quarter, sales declined 7% to $2,437 million. Comps in the first quarter decreased 9%. The exit from the swim and apparel categories had hurt the overall company and Victoria’s Secret comparable sales by 6 percentage points and 9 percentage points, respectively.
However, the company raised first-quarter earnings guidance to 30 cents from a band of 20–25 cents a share on account of lower tax rate.
This Zacks Rank #3 (Hold) company commands a market leading position in the lingerie, personal care and beauty segments. We believe that its innovation in merchandise and exclusive assortments remain popular among consumers and sets it apart from peers. L Brands with operational efficiencies, new and innovative assortments remains well positioned to capitalize on the same.
Further, L Brands continues to revamp business by improving store experience, localizing assortments and enhancing direct business. We believe these measures facilitate it to generate incremental sales and increase store transactions through higher conversion rate.
Stocks to Consider
Better-ranked stocks worth considering include Big 5 Sporting Goods Corp. (BGFV - Free Report) , The Children's Place, Inc. (PLCE - Free Report) and Michaels Companies Inc. . Big 5 Sporting Goods and The Children's Place sport a Zacks Rank #1 (Strong Buy) while Michaels Companies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Big 5 Sporting Goods has long-term earnings growth rate of 12%.
Children's Place has reported earnings beat in the trailing four quarters, with an average of 39% and also the company has long-term earnings growth rate of 8%.
Michaels an impressive long-term earnings growth rate of 16%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
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L Brands' (LB) Sluggish Comparable Sales Run Continues
L Brands, Inc. witnessed a decline in comparable sales (comps) for the fifth consecutive month as the company reported April sales numbers. This specialty retailer of women’s intimate and other apparel, beauty and personal care products posted 5% decline in comps for the four-week ended Apr 29 after registering a decline of 10%,13%, 4% and 1% in March, February, January and December, respectively. Moreover, net sales for April dipped 2% to $719.6 billion.
Late Easter holiday positively impacted the company’s April comps by nearly 3%. However, the exit from the swim and apparel categories had a 6 percentage points and 10 percentage points adverse impact on overall company and Victoria’s Secret comparable sales, respectively.
Dismal comps performances in the past five months have hurt the company’s shares. We noted that the stock has plunged 23.2% in the past six months, compared with the Zacks categorized Retail-Apparel/Shoe industry’s decline of 12.6%.
Further, the company also reported first-quarter 2017 sales number. In the first quarter, sales declined 7% to $2,437 million. Comps in the first quarter decreased 9%. The exit from the swim and apparel categories had hurt the overall company and Victoria’s Secret comparable sales by 6 percentage points and 9 percentage points, respectively.
However, the company raised first-quarter earnings guidance to 30 cents from a band of 20–25 cents a share on account of lower tax rate.
This Zacks Rank #3 (Hold) company commands a market leading position in the lingerie, personal care and beauty segments. We believe that its innovation in merchandise and exclusive assortments remain popular among consumers and sets it apart from peers. L Brands with operational efficiencies, new and innovative assortments remains well positioned to capitalize on the same.
Further, L Brands continues to revamp business by improving store experience, localizing assortments and enhancing direct business. We believe these measures facilitate it to generate incremental sales and increase store transactions through higher conversion rate.
Stocks to Consider
Better-ranked stocks worth considering include Big 5 Sporting Goods Corp. (BGFV - Free Report) , The Children's Place, Inc. (PLCE - Free Report) and Michaels Companies Inc. . Big 5 Sporting Goods and The Children's Place sport a Zacks Rank #1 (Strong Buy) while Michaels Companies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Big 5 Sporting Goods has long-term earnings growth rate of 12%.
Children's Place has reported earnings beat in the trailing four quarters, with an average of 39% and also the company has long-term earnings growth rate of 8%.
Michaels an impressive long-term earnings growth rate of 16%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>