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Buckle's March Sales Report Disappoints Amid Coronavirus Woes

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The coronavirus pandemic has claimed innumerable lives, rattled the stock market and brought the economy to standstill. The retail sector, in particular, has been dealt a massive blow. Supply-chain bottlenecks and reduced traffic has either led to store closures or limited operating hours, which in turn is hurting sales and productivity. It comes as no surprise, The Buckle, Inc. (BKE - Free Report) disappointed with March sales performance.

We noted that Buckle’stotal net sales for the five-week fiscal month ended Apr 4, 2020 plunged 50.2% to $41 million from net sales of $82.3 million reported in the prior year five-week fiscal month ended Apr 6, 2019. This follows an improvement of 6% and 3.2% in the month of February and January, respectively.

As earlier informed, this Zacks Rank #4 (Sell) has extended store closures for an indefinite period beginning Mar 18, 2020 due to the pandemic. However, the company’s online business will continue to operate. On account of store closures, management has decided to report only total net sales number each month. It will not provide any data related to comparable store sales during this time.



Given the unprecedented impacts of this outbreak, Buckle has furloughed most of its employees, including store and corporate office workers, starting Apr 5. The company had earlier stated that during this time, all employees will be offered full benefits, while those working will get a pay cut. In view of the scenario, its chairman and president and CEO stepped forward to forgo their salaries till operations resume.

Well we still don’t know how long this battle with COVID-19 will be. However in the meantime, policymakers are using every tool — slashing benchmark interest rate and announcing stimulus plan — to halt economic meltdown. President Trump signed a $2-trillion economic relief package aimed at assisting workers, small industries and distressed companies on the brink of extinction. Experts believe that once the coronavirus spread is contained and vaccine discovered, the retail sector, which touches every sphere of life, is likely to witness a sharp rebound.

Shares of Buckle have plunged 39.5% compared with the industry’s decline of 40.7% in the past three months.

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