Friday, August 27, 2010

Angst Among Teen Retailers

Maybe America's malls are not quite as empty yet as the one in the Romero classic Dawn Of The Dead, but investors can definitely hear some moaning from retailers. Wednesday's earnings from American Eagle Outfitters (NYSE:AEO) will not stand out as being all that exceptional, as most youth-oriented retailers saw a poor second quarter and have little optimism about the back-to-school season.

The Quarter That Was
American Eagle reported that total sales rose 1%, while comparable store sales fell 1%. Unfortunately, there was not much to mitigate this performance. The company spent the quarter shutting down the disappointing MARTIN + OSA stores (so much for its attempt to move out of the core teen market), and overall online sales were down 9%. Making matters worse, that poor sales performance would have been even worse without some aggressive markdowns, and those markdowns pushed gross profit down 6%.


To read the entire article, please click on the link:
http://stocks.investopedia.com/stock-analysis/2010/Angst-Among-Teen-Retailers-AEO-PSUN-HOTT-ZUMZ-ARO-BKE-ANF0827.aspx

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