August delivered some mixed numbers for retailers Buckle Inc (NYSE: BKE), Gap Inc (NYSE: GPS) and L Brands Inc (NYSE: LB). In a new report, Wedbush analyst Morry Brown discussed August sales numbers for
the three retailers.
In terms of same-store sales (SSS), L Brands came in slightly ahead of expectations for the month, while Gap fell slightly below
expectations. Buckle, on the other hand, reported a -14.8 percent comp in August, well short of consensus expectations of -8.8
percent.
“We believe the shift in fashion away from embellishment-heavy items (higher AUR) toward simple styles (lower AUR) will continue
to pressure top and bottom line results,” Brown said of Buckle.
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In light of the disappointing numbers, Wedbush dialed back its 2016/2017/2018 EPS estimates for Buckle from $2.45/$2.46/$2.47 to
$2.33/$2.32/$2.33. In addition, the firm lowered its price target for the stock from $22 to $21.
Brown also noted that the new price target for Buckle represents only a 9x multiple on forward 24-month EPS projections because
of the company’s slowing sales trends and margin uncertainty.
Wedbush maintains its $25 price target for Gap and its $65 price target for L Brands and did not adjust earnings estimates
through 2018. The firm has a Neutral rating on all three stocks.
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Latest Ratings for BKE
| Date |
Firm |
Action |
From |
To |
| May 2016 |
Wolfe Research |
Downgrades |
Peer Perform |
Underperform |
| Apr 2016 |
Deutsche Bank |
Initiates Coverage on |
|
Sell |
| Mar 2016 |
Standpoint Research |
Downgrades |
Buy |
Hold |
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BKE
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