The retail industry could be headed for a tough holiday season. Here’s a roundup of 3 companies that just cut their profit outlooks.

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holiday shopping

  • Slashed full-year profit outlooks are weighing on retail stocks ahead of the important holiday season. 
  • After disappointing earnings reports this week, the S&P 500 Retail Index is down 4%. 
  • The slide was led by double-digit drops in Macy’s and Kohl’s
  • Here are three companies that cut profit expectations for the rest of the year, and how it has affected their stock prices. 
  • Read more on Business Insider.

Big third-quarter earnings misses by retailers over the last week are dragging on the entire retail industry before the holiday season. 

Double-digit stock price slides from Macy’s and Kohl’s weighed on the S&P 500 Retail Index, which lost as much as 4% this week. The S&P 500 index has only fallen as much as 0.2% in the same period. 

Weak sales, disappointing earnings, and lowered full-year profit forecasts led declines. It was the second time this year that Kohl’s and Home Depot have lowered earnings expectations, which is not a good sign going into the holidays, the busiest and most important season for retailers.

In 2018, the holiday season contributed to a strong end of the year for retailers such as Target, Lululemon, American Eagle, and Kohl’s. But the year-end boost hasn’t totally translated into success in 2019 — companies such as Sears, Kmart, and Walmart have had to shut stores in the ongoing retail apocalypse.

Not all recent earnings have disappointed. Retailers Target, Gap, and Walmart posted third-quarter results that exceeded analyst expectations. 

But, those reports and subsequent stock gains weren’t enough to lift the struggling industry as a whole. The S&P 500 Retail Index has gained only slightly more than 5% year-to-date, while the S&P 500 has gained nearly 24%. 

Here are the key numbers from three companies that lowered full-year profit outlooks, and how much the stock has been affected:

1. Home Depot

Ticker: HD

Reported earnings: November 19

  • Adjusted earnings per share: $2.53 reported versus $2.53 (expected)
  • Revenue: $27.22 billion reported versus $27.72 billion (expected) 
  • Same-store sales: +3.6% reported versus 4.6% (expected) 

Full-year EPS guidance: Maintained expectation of $10.03 but trimmed full-year comparable sales to 3.5% from 4% and revenue outlook to growth of 1.8% from 2.3%

Stock decline post-earnings through Thursday’s close: -8%

2. Kohl’s

Ticker: KSS

Reported earnings: November 19

  • Adjusted earnings per share: 74 cents, versus 86 cents (expected)
  • Revenue: $4.36 billion, versus $4.40 billion (expected)
  • Comparable sales growth: 0.4%, versus 0.8% (expected)

Full-year EPS guidance: $4.75 to $4.95, versus prior guidance of $5.15 to $5.45

Stock decline post earnings through Thursday’s close: -19%  

3. Macy’s

Ticker: M

Reported earnings: November 21

  • Adjusted earnings per share: 7 cents reported, versus 1 cent (expected)
  • Revenue: $5.17 billion reported, versus $5.30 billion (expected) 
  • Same-store sales: -3.9% reported, versus -1.2% (expected)

Full-year EPS guidance: $2.57 to $2.77, previously saw $2.85 to $3.05

Stock decline post earnings through Thursday’s close: -2.3%