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The Zacks Analyst Blog Highlights: J. C. Penney, Kohl's, Dillard's and Macy's
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For Immediate Release
Chicago, IL – October 31, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include J. C. Penney Company, Inc. , Kohl's Corporation (KSS - Free Report) , Dillard's, Inc. (DDS - Free Report) and Macy's, Inc. (M - Free Report) .
JCPenney Plummets on View Cut, Drags Down Other Retailers
The stock market runs on sentiment and any unforeseen event in a particular sector has a ripple effect on others with a clear reflection on major indices that bear the brunt. The case is more or less the same for specific sectors that often observe good or bad performance by one player influencing the performance of others.
While major indices — Dow Jones Industrial Average, Nasdaq and S&P 500 ended the Friday’s trading session on a positive note, the SPDR S&P Retail ETF (XRT) fell 1.5%. We believe J. C. Penney Company, Inc. disappointing forecast may have been one of the reasons behind the SPDR S&P Retail ETF’s decline.
Dismal Forecast
Shares of J. C. Penney tanked 14.8% on Oct 27 after the company trimmed full-year guidance. In fact, this Zacks Rank #4 (Sell) stock has tumbled 41.7% in the past six months, wider than the industry’s decline of 15.5%. The company stated that in an effort to clear “slow-moving” goods mostly in women’s apparel department it increased markdowns in September and October.
Chairman and chief executive officer of the company, Marvin R. Ellison said, “With a sharper and more disciplined focus on inventory management, we are taking a comprehensive approach to assessing the effectiveness of our inventory positions to make swift, informed decisions that promote faster inventory turn and higher productivity levels.”
Management also stated that following the liquidation of slow moving inventory, the company’s fund has increased. This will help to invest in fresh as well as trending merchandise categories.
For third-quarter fiscal 2017, the company expects comparable sales to grow between 0.6% and 0.8 %. However, cost of goods (excluding depreciation and amortization) to rise 300-320 basis points (bps) year over year.
In the third quarter, the company expects adjusted loss to be in the range of 45-40 cents per share. In third-quarter fiscal 2016, the company has reported loss per share of 21 cents.
For fiscal 2017, the comps is projected to be in the range of down 1% to flat, compared with the earlier estimate of down 1% to up 1%. Cost of goods sold is now forecasted to increase by 100-120 bps year over year, while free cash flow is anticipated to be in the range of $200-$300 million. The company now expects adjusted earnings per share to be in the range of 2- 8 cents, sharply below the earlier estimate of 40-65 cents.
Domino Effect
Following the news, investors pressed the panic button that took a toll on other retail stocks.
Kohl's Corporationstock declined 4.6% following the news. The company has reported positive earnings surprise in the trailing four quarters, with an average beat of 18%. For the third quarter, the Zacks Consensus Estimate is pegged at 71 cents, down nearly 11% year over year. Kohl's currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Dillard's, Inc., which operates as fashion apparel, cosmetics, and home furnishing retailer, declined 3.4%. This Zacks Rank #4 (Sell) company’s consensus estimate for third-quarter fiscal 2017 is pegged at 23 cents per share, down nearly 66% year over year. Further, the company’s long-term earnings growth rate is pegged at 2.6%, well below the industry’s growth rate of 5.6%.
Shares of Macy's, Inc. decreased 7.7%. After witnessing negative earnings surprise in first-quarter fiscal 2017, the company posted earnings beat of 6.7% in the second quarter. For the third quarter, the consensus estimate currently stands at 19 cents, up nearly 13% year over year. Macy’s currently carries a Zacks Rank #3 (Hold).
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: J. C. Penney, Kohl's, Dillard's and Macy's
For Immediate Release
Chicago, IL – October 31, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include J. C. Penney Company, Inc. , Kohl's Corporation (KSS - Free Report) , Dillard's, Inc. (DDS - Free Report) and Macy's, Inc. (M - Free Report) .
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Monday’s Analyst Blog:
JCPenney Plummets on View Cut, Drags Down Other Retailers
The stock market runs on sentiment and any unforeseen event in a particular sector has a ripple effect on others with a clear reflection on major indices that bear the brunt. The case is more or less the same for specific sectors that often observe good or bad performance by one player influencing the performance of others.
While major indices — Dow Jones Industrial Average, Nasdaq and S&P 500 ended the Friday’s trading session on a positive note, the SPDR S&P Retail ETF (XRT) fell 1.5%. We believe J. C. Penney Company, Inc. disappointing forecast may have been one of the reasons behind the SPDR S&P Retail ETF’s decline.
Dismal Forecast
Shares of J. C. Penney tanked 14.8% on Oct 27 after the company trimmed full-year guidance. In fact, this Zacks Rank #4 (Sell) stock has tumbled 41.7% in the past six months, wider than the industry’s decline of 15.5%. The company stated that in an effort to clear “slow-moving” goods mostly in women’s apparel department it increased markdowns in September and October.
Chairman and chief executive officer of the company, Marvin R. Ellison said, “With a sharper and more disciplined focus on inventory management, we are taking a comprehensive approach to assessing the effectiveness of our inventory positions to make swift, informed decisions that promote faster inventory turn and higher productivity levels.”
Management also stated that following the liquidation of slow moving inventory, the company’s fund has increased. This will help to invest in fresh as well as trending merchandise categories.
For third-quarter fiscal 2017, the company expects comparable sales to grow between 0.6% and 0.8 %. However, cost of goods (excluding depreciation and amortization) to rise 300-320 basis points (bps) year over year.
In the third quarter, the company expects adjusted loss to be in the range of 45-40 cents per share. In third-quarter fiscal 2016, the company has reported loss per share of 21 cents.
For fiscal 2017, the comps is projected to be in the range of down 1% to flat, compared with the earlier estimate of down 1% to up 1%. Cost of goods sold is now forecasted to increase by 100-120 bps year over year, while free cash flow is anticipated to be in the range of $200-$300 million. The company now expects adjusted earnings per share to be in the range of 2- 8 cents, sharply below the earlier estimate of 40-65 cents.
Domino Effect
Following the news, investors pressed the panic button that took a toll on other retail stocks.
Kohl's Corporationstock declined 4.6% following the news. The company has reported positive earnings surprise in the trailing four quarters, with an average beat of 18%. For the third quarter, the Zacks Consensus Estimate is pegged at 71 cents, down nearly 11% year over year. Kohl's currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Dillard's, Inc., which operates as fashion apparel, cosmetics, and home furnishing retailer, declined 3.4%. This Zacks Rank #4 (Sell) company’s consensus estimate for third-quarter fiscal 2017 is pegged at 23 cents per share, down nearly 66% year over year. Further, the company’s long-term earnings growth rate is pegged at 2.6%, well below the industry’s growth rate of 5.6%.
Shares of Macy's, Inc. decreased 7.7%. After witnessing negative earnings surprise in first-quarter fiscal 2017, the company posted earnings beat of 6.7% in the second quarter. For the third quarter, the consensus estimate currently stands at 19 cents, up nearly 13% year over year. Macy’s currently carries a Zacks Rank #3 (Hold).
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.
Click here for Zacks' private trades >>
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.