We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Zacks Industry Outlook Highlights: The Children's Place, Abercrombie & Fitch, Gap and American Eagle Outfitters
Read MoreHide Full Article
For Immediate Release
Chicago, IL – July 6, 2021 – Today, Zacks Equity Research discusses Retail - Apparel & Shoes including The Children's Place, Inc. (PLCE - Free Report) , Abercrombie & Fitch Co. (ANF - Free Report) , The Gap, Inc. (GPS - Free Report) and American Eagle Outfitters, Inc. (AEO - Free Report) .
The pandemic has reshaped almost every other sector prompting them to rewrite the rules of game and transforming the business processes. Evidently, Retail - Apparel And Shoes industry has not been an exception. While inventory management, supply chain enhancement and cost structure realignment have been part & parcel of business strategies, investment to accelerate digitization has now become paramount. Without doubt, the pandemic has rapidly changed the convenience of digitization into a necessity.
Industry participants have been emphasizing on membership programs, upgradation of store technology and omni-channel capabilities, shopping via mobile app, last mile delivery solutions, and forming alliance with digitally native retailers.
Players in the industry have been aggressively adopting strategies and making planned investments to cater to customer demand be it in store or online. Undeniably, expedited delivery services like doorstep delivery, curbside pickup or buy online and pick up at store as well as contactless payment gateway will continue to play a crucial role in maximizing share of customers' wallet. Industry experts cited that companies also need to rework on assortments to meet emerging trends in the post-pandemic world, including a more customized approach.
Well, as Americans look to refresh their wardrobes, thanks to the resumption of active social lifestyle, events and occasions, apparel companies need to increase product visibility on online platforms, enhance customer engagement on social channels and make logistical improvements. More than a year now since the pandemic had struck the economy, we believe that online shopping is here to stay even after the risk of infection subsides owing to safety and convenience.
Check Out These Four Apparel Players
The Children's Place has been making investments to upgrade its omni-channel capabilities as part of its digital transformation strategy. The company's $50 million digital transformation investment in order to meet online demand is reaping benefits. The company has one of the highest digital penetrations in the industry.
We note that the company's consolidated digital sales surged 37% during first-quarter fiscal 2021, representing 42% of total sales. Digital sales rose 35% in the United States and 82% in Canada. The expansion of digital business coupled with the significant sales transfer rate that the company is attaining owing to the strategic decision to shutter 300 stores is resulting in long-term steady state annual digital penetration of 50%.
This pure-play children's specialty apparel retailer has been making efforts to lower dependency on brick-and-mortar platforms and shift toward digitization. This Zacks Rank #1 (Strong Buy) company is aiming for a mall-based brick-and-mortar portfolio to account for less than 25% of revenues entering fiscal 2022. You can see the complete list of today's Zacks #1 Rank stocks here.
Abercrombie & Fitch has been making significant progress in expanding digital and omni-channel capabilities to better engage with consumers. The company's strong digital momentum continued in first-quarter fiscal 2021, which boosted the top line. Digital net sales advanced 45% year over year, contributing about 52% of total sales.
The digital business mainly benefited from the addition of new customers in the channel, backed by robust digital marketing efforts. Also, high customer retention and spend per customer aided sales growth. The company remains encouraged with its strong online presence and expects to keep gaining from this platform.
This Zacks Rank #1 company plans to continue investing toward bolstering omni-channel capabilities including curbside pickup and ship from store services. For fiscal 2021, the company expects capital expenditure of $100 million. Roughly 50% of the capital spending is expected to be used for investments in digital and technology.
Gap's online sales have been increasing, courtesy of omni-channel capabilities, including curbside pick-up and ship-from-store. The company continued to witness strength in the online business during the first quarter of fiscal 2021 with digital sales increasing 61% from first-quarter fiscal 2020 and 82% from first-quarter fiscal 2019.
Notably, its digital business contributed 40% of total sales in the quarter under review. Continued growth in e-commerce business contributed significantly to the company's consolidated sales as well as gains in its Gap, Old Navy and Athleta brands.
Going ahead, management remains keen on optimizing mobile experience as a key priority in fiscal 2021. The company launched its native Android app in March, which is gaining traction. Moreover, alternative payment options namely, PayPal and AfterPay, represented 20% of online spend during the first quarter.
This retailer of clothing, accessories and personal care products registered a more than 60% jump in new online customers acquired versus last year. This Zacks Rank #3 (Hold) company now envisions fiscal 2021 net sales growth in the low-to-mid twenty percent range compared with prior projection of mid-to-high teens increase.
American Eagle Outfitters has been witnessing strong digital demand on the shift in consumers' shopping preference. Investments made in digital platform, omni-channel capabilities and supply chain have been aiding in meeting customers' demand more effectively.
This specialty retailer of on-trend clothing, accessories, and personal care products saw its first-quarter fiscal 2021 digital revenues rising 57% from first-quarter fiscal 2019 levels. Notably, online sales across the Aerie and AE brands were up 158% and 20%, respectively.
Overall, online sales contributed nearly 40% to the company's revenues in the first quarter. This Zacks Rank #3 has been enhancing curbside and in-store pickup features. Its improved mobile experience and redesigned app, resulted in 70% surge in revenues from total mobile.
Zacks' Top Picks to Cash in on Artificial Intelligence
In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Zacks Industry Outlook Highlights: The Children's Place, Abercrombie & Fitch, Gap and American Eagle Outfitters
For Immediate Release
Chicago, IL – July 6, 2021 – Today, Zacks Equity Research discusses Retail - Apparel & Shoes including The Children's Place, Inc. (PLCE - Free Report) , Abercrombie & Fitch Co. (ANF - Free Report) , The Gap, Inc. (GPS - Free Report) and American Eagle Outfitters, Inc. (AEO - Free Report) .
Link: https://www.zacks.com/stock/news/1757061/digitization-holds-the-key-4-apparel-players-to-watch-out-for
The pandemic has reshaped almost every other sector prompting them to rewrite the rules of game and transforming the business processes. Evidently, Retail - Apparel And Shoes industry has not been an exception. While inventory management, supply chain enhancement and cost structure realignment have been part & parcel of business strategies, investment to accelerate digitization has now become paramount. Without doubt, the pandemic has rapidly changed the convenience of digitization into a necessity.
Industry participants have been emphasizing on membership programs, upgradation of store technology and omni-channel capabilities, shopping via mobile app, last mile delivery solutions, and forming alliance with digitally native retailers.
Players in the industry have been aggressively adopting strategies and making planned investments to cater to customer demand be it in store or online. Undeniably, expedited delivery services like doorstep delivery, curbside pickup or buy online and pick up at store as well as contactless payment gateway will continue to play a crucial role in maximizing share of customers' wallet. Industry experts cited that companies also need to rework on assortments to meet emerging trends in the post-pandemic world, including a more customized approach.
Well, as Americans look to refresh their wardrobes, thanks to the resumption of active social lifestyle, events and occasions, apparel companies need to increase product visibility on online platforms, enhance customer engagement on social channels and make logistical improvements. More than a year now since the pandemic had struck the economy, we believe that online shopping is here to stay even after the risk of infection subsides owing to safety and convenience.
Check Out These Four Apparel Players
The Children's Place has been making investments to upgrade its omni-channel capabilities as part of its digital transformation strategy. The company's $50 million digital transformation investment in order to meet online demand is reaping benefits. The company has one of the highest digital penetrations in the industry.
We note that the company's consolidated digital sales surged 37% during first-quarter fiscal 2021, representing 42% of total sales. Digital sales rose 35% in the United States and 82% in Canada. The expansion of digital business coupled with the significant sales transfer rate that the company is attaining owing to the strategic decision to shutter 300 stores is resulting in long-term steady state annual digital penetration of 50%.
This pure-play children's specialty apparel retailer has been making efforts to lower dependency on brick-and-mortar platforms and shift toward digitization. This Zacks Rank #1 (Strong Buy) company is aiming for a mall-based brick-and-mortar portfolio to account for less than 25% of revenues entering fiscal 2022. You can see the complete list of today's Zacks #1 Rank stocks here.
Abercrombie & Fitch has been making significant progress in expanding digital and omni-channel capabilities to better engage with consumers. The company's strong digital momentum continued in first-quarter fiscal 2021, which boosted the top line. Digital net sales advanced 45% year over year, contributing about 52% of total sales.
The digital business mainly benefited from the addition of new customers in the channel, backed by robust digital marketing efforts. Also, high customer retention and spend per customer aided sales growth. The company remains encouraged with its strong online presence and expects to keep gaining from this platform.
This Zacks Rank #1 company plans to continue investing toward bolstering omni-channel capabilities including curbside pickup and ship from store services. For fiscal 2021, the company expects capital expenditure of $100 million. Roughly 50% of the capital spending is expected to be used for investments in digital and technology.
Gap's online sales have been increasing, courtesy of omni-channel capabilities, including curbside pick-up and ship-from-store. The company continued to witness strength in the online business during the first quarter of fiscal 2021 with digital sales increasing 61% from first-quarter fiscal 2020 and 82% from first-quarter fiscal 2019.
Notably, its digital business contributed 40% of total sales in the quarter under review. Continued growth in e-commerce business contributed significantly to the company's consolidated sales as well as gains in its Gap, Old Navy and Athleta brands.
Going ahead, management remains keen on optimizing mobile experience as a key priority in fiscal 2021. The company launched its native Android app in March, which is gaining traction. Moreover, alternative payment options namely, PayPal and AfterPay, represented 20% of online spend during the first quarter.
This retailer of clothing, accessories and personal care products registered a more than 60% jump in new online customers acquired versus last year. This Zacks Rank #3 (Hold) company now envisions fiscal 2021 net sales growth in the low-to-mid twenty percent range compared with prior projection of mid-to-high teens increase.
American Eagle Outfitters has been witnessing strong digital demand on the shift in consumers' shopping preference. Investments made in digital platform, omni-channel capabilities and supply chain have been aiding in meeting customers' demand more effectively.
This specialty retailer of on-trend clothing, accessories, and personal care products saw its first-quarter fiscal 2021 digital revenues rising 57% from first-quarter fiscal 2019 levels. Notably, online sales across the Aerie and AE brands were up 158% and 20%, respectively.
Overall, online sales contributed nearly 40% to the company's revenues in the first quarter. This Zacks Rank #3 has been enhancing curbside and in-store pickup features. Its improved mobile experience and redesigned app, resulted in 70% surge in revenues from total mobile.
Zacks' Top Picks to Cash in on Artificial Intelligence
In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.
See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>
Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
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.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
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.