Investopedia: Lululemon Slips During Its Highwire Act

You can think of Canadian specialty athletic clothing retailer Lululemon Athletica (Nasdaq: LULU) and the Street's reaction to this quarter, in this way: When you're just walking along the street and have a slight stumble or slip, it's no big deal; nobody notices, nobody cares and you probably don't even break stride. Now, imagine having that same stumble when you're on a wire fifty feet above the ground, with thousands of people staring up at you; the consequences of a mistake are a bit higher.

Some Spots Show Up in the Third Quarter 

Lululemon has gotten this far, largely on the basis of promising good growth and then delivering even better results. Not this time, though. Although 16% comps growth would be a level of performance that the CEOs of Gap (NYSE: GPS), American Eagle (NYSE: AEO) or Kohl's (NYSE: KSS) would sell a family member to get, it's not going to satisfy the Lululemon crowd, when the last quarter's performance was 20%. Moreover, sales growth of 31% was quite nice, but the company actually missed the average sell-side guess by about $5 million.

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http://stocks.investopedia.com/stock-analysis/2011/Lululemon-Slips-During-Its-Highwire-Act-LULU-GPS-NKE-LTD-ADDYY-AEO-KSS-ANF1202.aspx

Investopedia: Urban Warfare

When a company's management spends part of their earnings conference call talking about a company's ten-year trends and history, that is often a bad sign. Such is the case for Urban Outfitters (Nasdaq:URBN). However impressive Urban Outfitters' past may be, it is not going to spare the stock today as investors focus on worrisome developments in margins and inventory. 

A Sour Note To End 2010
Urban Outfitters did report 14% overall sales growth for the fourth quarter. That is pretty much it for the good news. That sales level was a bit below analyst expectations, and store comps were down 2% as transactions fell about 1%. On a slightly more encouraging note, sales comps were up 4% if direct-to-consumer sales are included.

To its credit, Urban Outfitters has managed to do what American Eagle (NYSE:AEO) and many other retailers have struggled to do - operate multiple successful brands. The core Urban Outfitters brand saw revenue increase 13% this quarter, with Anthropologie up 10% and Free People up 35%. URBN also has a successful direct-to-consumer business, and revenue here jumped 28%.

Turning back to bad news, the company saw gross margin shrink more than 2% as the company had to get more aggressive with markdowns to move product. SG&A growth matched sales, though, and the company saw operating income tick up 1% while operating margin fell more than 2%. Taxes also came in above analyst expectations, contributing a few pennies to the company's earnings miss.


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Investopedia: Can Chico's Be Chic Again?

Women's retailer Chico's (NYSE:CHS) was a great growth stock for almost a decade, profiting off its relatively fashionable offerings for working women and ability to differentiate itself from the likes of Gap (NYSE:GPS), Limited Brands (NYSE:LTD) as well as mall anchors like JCPenny (NYSE:JCP) and Dillards (NYSE:DDS). But then Chico's experienced what almost all retailers experience - merchandising missteps, overexpansion, questionable acquisitions and a customer base that just wants to shop somewhere else for a change. 

The good news for retail investors is that there are certainly second acts in retailing (as well as third, and fourth). The question, though, is whether Chico's has whipped itself into shape in time to take advantage of an improving market. (For related reading see 5 Retail Stocks For 2011.)

An Iffy End to the Year
Chico's did not report especially exciting numbers for the fourth quarter, but the market was expecting worse so it all netted out to a "positive quarter", especially as the company gave encouraging sales growth guidance for fiscal 2011.



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http://stocks.investopedia.com/stock-analysis/2011/Can-Chicos-Be-Chic-Again-CHS-JCP-BAL-HBI-RL-LULU-KSS0228.aspx.