24/7 Wall St. » COH

Does A Ralph Lauren Dividend Double Matter To Peers?

Administrator — Tue, 22 May 2012 12:51:45 +0000

Ralph Lauren Corporation (NYSE: RL) has what would appear to be good news in most headline watching: the high-end apparel maker is doubling its dividend. Unfortunately this is getting lost in the shuffle after its earnings report showed gains of 29%. The company has now declared a quarterly dividend of $0.40 per share, or $1.60 when you take it on an annualized basis, from its prior level of $0.20 per share per quarter. The prior rate is rounded up to 0.6% but the new rate based upon a $146.30 closing price would generate a dividend yield of 1.09%. Our aim is to see if a dividend that sounds this low really matters, and we want to see how it stacks up against large peer companies.

The dividend will be payable on July 13, 2012, to stockholders of record on June 29, 2012, with an ex-dividend date of June 27, 2012.

As far as how this dividend compares to the other large apparel makers, this is as follows: V.F. Corporation (NYSE: VFC) has close to a 2.1% dividend yield and Columbia Sportswear Company (NASDAQ: COLM) has a 1.9% yield. Having a 1% or 2% dividend might not sound huge on the surface when you consider the DJIA components and other dividend growers, but most of the large apparel companies either do not pay a dividend or they have a low yield. Accessories maker Coach, Inc. (NYSE: COH) has a 1.8% yield. Even the great sports apparel and equipment maker Nike Inc. (NYSE: NKE) pays only a 1.4% yield to investors.

Maybe a 1.1% dividend yield now isn’t so bad after all. The 5-year Treasury note pays only 0.74% and the 10-year Treasury pays 1.74% right now.

JON C. OGG

Filed under: Accounting, Apparel, Dividend, Retail, Shareholder Issues Tagged: COH, COLM, NKE, RL, VFC

24/7 Wall St. Closing Bell (AAPL, T, XRX, GE, LNKD, BIG, AZO, APD, BHI, COH, ITW, MHP, RSH, RF, HSY, NFLX, IBM, NAT, EGLE)

Paul Ausick — Tue, 24 Apr 2012 20:11:08 +0000

Markets opened mixed this morning, with the DJIA showing much more strength than the S&P 500, which opened higher, or the Nasdaq, which opened lower. The S&P Case-Shiller house price index showed another decline in home prices (our coverage here), although new home sales rose slightly. The Conference Board’s consumer confidence index was lower this month as well (our coverage here). Tech stocks have been weak all day as sentiment about the Apple Inc. (NASDAQ: AAPL) earnings report faltered following comments from AT&T Inc. (NYSE: T) related to iPhone connections (our coverage here). The US dollar index fell today, now down -0.25% at 79.220. The GSCI commodity index is down -0.28% at 675.82, with commodities mostly rising on the weaker dollar. WTI crude oil closed up 0.4% at $103.55/barrel, and Brent crude trades down -0.48% at $118.14/barrel. Gold settled up 0.7% today, at $1,643.80/ounce.

The unofficial closing bells put the DJIA up about 74 points to 13,001.56 (0.58%), the NASDAQ fell nearly 9 points (-0.30%) to 2,961.60, and the S&P 500 rose 0.37% or about 5 points to 1,371.97.

There were several analyst upgrades and downgrades today, including Xerox Corp. (NYSE: XRX) reiterated ‘buy’ with a target price of $13 at Argus; General Electric Co. (NYSE: GE) reiterated ‘buy’ with a target price of $22 at Argus; LinkedIn Corp. (NYSE: LNKD) started as ‘overweight’ at Piper Jaffray; Big Lots Inc. (NYSE: BIG) cut to ‘hold’ at Deutsche Bank; and AutoZone Inc. (NYSE: AZO) raised to ‘overweight’ at JPMorgan.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: AT&T is up 3.9% at $31.81; Air Products and Chemicals Inc. (NYSE: APD) is down -4.3% at $84.91; Baker Hughes Inc. (NYSE: BHI) is up 5.3% at $43.23 (more coverage here); Coach Inc. (NYSE: COH) is down -4% at $72.10 (more coverage here); Illinois Tool Works Inc. (NYSE: ITW) is up 2.7% at $56.71; McGraw-Hill Companies Inc. (NYSE: MHP) is down -3% at $47.65; RadioShack Corp. (NYSE: RSH) is down -10.3% at $5.36 after posting a new 52-week intraday low of $5.27; Regions Financial Corp. (NYSE: RF) is up 5.4% at $6.42; The Hershey Co. (NYSE: HSY) is up 5.7% at $65.86 after posting a new 52-week intraday high of $66.94; and Netflix Inc. (NASDAQ: NFLX) is down -14.6% at $87.01.

Other standouts from today include the following stocks:

International Business Machines Corp. (NYSE: IBM) is up .0.8% at $200.24. The tech giant raised its dividend today. More coverage here.

North American Tankers Ltd. (NYSE: NAT) is up 1.5% at $14.01. Shipping rates for dry bulk shippers are rising and tanker rates, especially for the smaller (1 million barrels) crude carriers of the Suezmax class. Many other shippers are also getting a boost today, including Eagle Bulk Shipping Inc. (NASDAQ: EGLE), which is up 6.8% at $1.88.

Stay tuned for Wednesday. The Federal Reserve Open Market Committee wraps up its two-day meeting and Chairman Ben Bernanke will hold a press conference this afternoon. We have noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Bankers Association purchase applications
8:30 a.m. – Durable goods orders
10:30 a.m. – EIA weekly petroleum status report
11:30 a.m. – 5-yr note auction
2:00 p.m. – FOMC forecasts

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AAPL, APD, AZO, BHI, BIG, COH, EGLE, GE, HSY, IBM, ITW, LNKD, MHP, NAT, NFLX, RF, RSH, T, XRX

Luxury Retailer Coach Raises Dividend, Beats Estimates to No Avail (COH, KORS, TUMI)

Paul Ausick — Tue, 24 Apr 2012 15:00:33 +0000

The high-end of the retail market has faced a few bumps in the first calendar quarter of 2012, with gasoline prices on a steady march higher while home prices continue to sink. Today’s earnings report from Coach Inc. (NYSE: COH), while better than expected on EPS and revenues, did not meet expected same-store sales targets for the company’s third fiscal quarter.

Two recently publicly traded companies could be making life a bit more difficult for Coach. Michael Kors Holdings Ltd. (NYSE: KORS) and Tumi Holdings Inc. (NYSE: TUMI) have now entered a sector dominated by LVMH Moet Hennessy Louis Vuitton (OTC: LVMUY.PK) and Coach.

Coach reported revenue of $1.11 billion for its third quarter, virtually on target with the consensus estimate of $1.10 billion. EPS came in at $0.77, better than the expected EPS of $0.75. What is hampering the shares today is a miss on same-store sales, which showed an increase of 6.7% for the quarter. Stifel Nicolaus’s analyst had an estimate of 7%.

And adding to the weight on the shares today is the simple fact that Coach didn’t have a blow-out quarter. Just meeting estimates — beating them by a little — isn’t enough to keep up investors’ spirits. Even a 33% jump in the dividend didn’t help. Coach will pay an annual dividend of $1.20/share beginning in July.

Over the past 12 months, Coach shares have gained nearly 39%. Year-to-date the company is up more than 18%, but Kors, which came public in December, is up nearly 59% in 2012. Tumi, which only came public last week, is down about -3.8% from a high of $28.70, more than 44% above the offering price of $18/share (Tumi’s underwriters did the company no favors).

The focus on men’s clothing and accessories will get sharper this year as the high-end retailers look for growth. In its last quarterly report, Coach noted that its men’s fashion revenue was on track to double, year-over-year, to $400 million in 2012. LVMH and Kors are also putting out more products aimed a male buyers, and Tumi probably won’t be far behind.

Coach shares are down about -3.4% at $72.60 in a 52-week range of $45.70-$79.70.

Paul Ausick

Filed under: Consumer Goods, Earnings, Retail Tagged: COH, KORS, TUMI

Top Earnings Previews For Early In The Week Ahead (COP, ILMN, NFLX, TXN, AMGN, AAPL, T, BIDU, COH, JNPR, MMM, RF, X, UTX)

Administrator — Fri, 20 Apr 2012 18:35:20 +0000

Earnings season is in full swing and we have many key reports due in the coming week. 24/7 Wall St. has provided some detailed previews for the key earnings reports we expect to show in detail on Monday and Tuesday.

We are monitoring earnings reports from the following companies for Monday and Tuesday: ConocoPhillips (NYSE: COP); Illumina Inc. (NASDAQ: ILMN); Netflix, Inc. (NASDAQ: NFLX); Texas Instruments Inc. (NASDAQ: TXN); Amgen Inc. (NASDAQ: AMGN); Apple Inc. (NASDAQ: AAPL); AT&T Inc. (NYSE: T); Baidu Inc. (NASDAQ: BIDU); Coach Inc. (NYSE: COH); Juniper Networks Inc. (NYSE: JNPR); 3M Co. (NYSE: MMM); Regions Financial Corporation (NYSE: RF); United States Steel Corporation (NYSE: X); and United Technologies Corporation (NYSE: UTX).

More earnings report previews will come on Sunday or Monday for the reports due on Wednesday, Thursday, and Friday. Consensus estimates and price targets are from Thomson Reuters. Color has been on added on each if applicable.

MONDAY, April 23

ConocoPhillips (NYSE: COP) is set to report Monday morning and the break-up is going to make any real apples to apples comparison difficult to interpret. Thomson Reuters has estimates of $2.07 EPS. Shares are trading around $73.15 and the 52-week range is $58.65 to $81.50; Thomson Reuters had a consensus target as of Friday of $81.05.

Illumina Inc. (NASDAQ: ILMN) is no market mover with a $5.4 billion market cap, but it is a recent merger candidate even if that appears to be off the table. Earnings estimates are $0.32 EPS and $263.6 million. Shares are trading around $44.00 and the 52-week range is $25.57 to $79.40; Thomson Reuters had a consensus target as of Friday of $52.71.

Filed under: Calendar, Earnings, The Week Tagged: AAPL, AMGN, BIDU, COH, COP, ILMN, JNPR, MMM, NFLX, RF, T, TXN, UTX, X

Top Analyst Upgrades & Downgrades (AAPL, BLK, BWLD, COH, CPO, GM, KBH, KR, MSFT, MS, NTRS, RHT, SBAC, SNV, AMTD, VE)

Administrator — Fri, 16 Mar 2012 12:19:20 +0000

These are some of this Friday’s top analyst upgrades, downgrades, and initiations seen in Wall Street research calls.

Apple Inc. (NASDAQ: AAPL) has seen targets raised this morning by Oppenheimer to $700 and by UBS to $675; see the strange downgrade from Thursday.

BlackRock, Inc. (NYSE: BLK) Cut to Hold at Deutsche Bank.

Buffalo Wild Wings, Inc. (NASDAQ: BWLD) Cut to Neutral at Wedbush.

Coach. Inc. (NYSE: COH) Raised estimates and target to $83 from $75 at Credit Suisse; Started as Buy with $90 target at Argus.

Corn Products International Inc. (NYSE: CPO) named as Value stock of the day at Zacks.

General Motors Co. (NYSE: GM) Cut target to $29 from $30 at Jefferies.

KB Home (NYSE: KBH) named Bear of the Day at Zacks.

The Kroger Company (NYSE: KR) named as Bull of the Day at Zacks.

Microsoft Corporation (NASDAQ: MSFT) Raised to Buy with $39 target at Argus.

Morgan Stanley (NYSE: MS) Cut to Hold at Deutsche Bank.

Northern Trust Corporation (NASDAQ: NTRS) Started as Neutral with $49 target at BofA/ML.

Red Hat Inc. (NYSE: RHT) Cut to Equal-weight at Morgan Stanley.

SBAC Communications Corporation (NASDAQ: SBAC) named as Top Pick at Credit Suisse.

Synovus Financial Corporation (NYSE: SNV) Cut to Neutral at Credit Suisse.

TD Ameritrade Holding Corporation (NASDAQ: AMTD) Cut to Hold at Deutsche Bank.

Veolia Environnement (NYSE: VE) Raised to Neutral from Sell at UBS.

If you enjoyed the top analyst upgrades and downgrades, you can join our free email newsletter that includes analyst summaries each morning sent right to your inbox. We also cover top issues such as IPOs, special financial exclusives, mergers and more. Sign up in the box below.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Analyst Calls Tagged: AAPL, AMTD, BLK, BWLD, COH, CPO, GM, KBH, KR, MS, MSFT, NTRS, RHT, SBAC, SNV, VE

The Most Profitable Stores in America

247wallst — Thu, 23 Feb 2012 01:20:45 +0000

The past few years have been challenging for the retailing industry, and there are signs that 2012 will be no different. One key metric used to judge the health of a store is sales per square foot. Research company RetailSails recently ranked U.S. stores based on this metric.

Read: The Most Profitable Stores in America

Apple is at the top of the list with the highest sales per square foot. Perhaps most interesting is the large gap between Apple stores and the rest of the market. Apple stores now average $5,600 per square foot of retail space, nearly double the nearest retailer. However, Apple is a unique case as a leader in technology and innovation, and a company with what may be the strongest brand name in the world.

24/7 Wall St. wanted to see if common features could be found among the retailers that managed to get top dollars per square foot. Branding is perhaps the biggest common factor because it helps drive traffic to the stores. Retail establishments with low foot traffic find it nearly impossible to have strong sales per square foot.

In addition, each retailer on the list could be considered luxury goods sellers, with the exception of GameStop. To GameStop’s advantage, however, gaming DVDs tend to take up less room on a shelf than, say, flatscreen TVs.

It is worth noting that four of the top companies are also featured on RetailSails’ 25 fastest-growing retailer list, on which retailers are ranked based on trailing four quarters sales growth. It could very well be that companies with highly profitable locations have easier access to capital to invest in new locations, which in turn further helps underwrite future growth. If so, high margins beget greater sales, at least for some period. The data from retailers on this list would help support that theory.

Also Read: The Ten States That Run on Nuclear Power

For comparison to these six highly successful retailers, Wal-Mart Stores (NYSE: WMT) has a gross margin of 25% and an average of $414 in sales per square foot. All data on revenue, net income and gross margins are based on trailing 12 months earnings reports.

Filed under: 24/7 Wall St. Wire, Retail, Special Report Tagged: AAPL, COH, GME, JWN, LULU, TIF, TRLG, WMT

24/7 Wall St. Top Analyst Calls of the Week (AONE, ALU, AMSC, NLY, AAPL, CSCO, COH, CSTR, COP, DLR, IBM, LF, MMM, M, OPEN, POST, SIRI, SOHU, TRLG, ZOLT)

Administrator — Sat, 11 Feb 2012 15:53:52 +0000

This last week was very busy, and Friday’s disappointing trading day skewed many research reports. Each morning we track analyst upgrades and downgrades and over the weekend we review each to see which stood out as highly insightful, or which were great money-makers for investors. Of course, there are some really bad calls that come about too. For better or worse, these make up the 24/7 Wall St. Top Analyst Calls of the Week.

This last weeks most featured reports were in shares of the following: A123 Systems, Inc. (NASDAQ: AONE); Alcatel-Lucent S.A. (NYSE: ALU); American Superconductor Corporation (NASDAQ: AMSC); Annaly Capital Management Inc. (NYSE: NLY); Apple Inc. (NASDAQ: AAPL); Cisco Systems, Inc. (NASDAQ: CSCO); Coach, Inc. (NYSE: COH); Coinstar, Inc. (NASDAQ: CSTR); ConocoPhillips (NYSE: COP); Digital Realty Trust, Inc. (NYSE: DLR); International Business Machines Corporation (NYSE: IBM); Leapfrog Enterprises Inc. (NYSE: LF); 3M Co. (NYSE: MMM); Macy’s Inc. (NYSE: M); OpenTable Inc. (NASDAQ: OPEN); Post Holdings Inc. (NYSE: POST); Sirius XM Radio Inc. (NASDAQ: SIRI); Sohu.com Inc. (NASDAQ: SOHU); True Religion Apparel, Inc. (NASDAQ: TRLG); and Zoltek Companies, Inc. (NASDAQ: ZOLT).

We have summarized each call and either added in trading color or provided a link to more data on each.

A123 Systems, Inc. (NASDAQ: AONE) was a highly influential call from a firm not very well known. The battery maker was downgraded on fears that Fiskar will not be able to keep buying from them. This fell 23% after it was cut to Sell at Wunderlich, but the price target was the real kicker: $0.50. Ouch.

Alcatel-Lucent S.A. (NYSE: ALU) was sure a wrong-way call of the week. The perpetually turning-around communications equipment maker was downgraded to ‘Sell’ at S&P Equity Research ahead of earnings and the stock closed up almost 13% at $2.19 on Friday.

American Superconductor Corporation (NASDAQ: AMSC) was inadvertently a really bad call because it got caught up in a weak stock market day and got caught on a day when alternative energy players took it on the chin. This one was raised to ‘Buy’ at Citigroup on Friday and closed don over 8% at $5.11 after opening at $5.36 on the day. Oops.

Annaly Capital Management Inc. (NYSE: NLY) had a rough week based in part on a mortgage foreclosure settlement. We expect the debate to continue over the real impact, but this high dividend yield mortgage REIT was downgraded to ‘Market Perform’ and the price target was cut to $16.00 from $17.50 by Friedman, Billings & Ramsey this last week.

Apple Inc. (NASDAQ: AAPL) keeps hitting new all-time highs each day. Apparently it is going to keep doing that for quite some time if Canaccord Genuity gets its way. That firm listed many reasons to raise it price target to $665 this last week.

Cisco Systems, Inc. (NASDAQ: CSCO) was better than what we feel the street gave it credit for on earnings. Credit Suisse only reiterated an ‘Outperform’ rating ahead of earnings, but what stood out was the $26.00 price target because that is about $4.50 higher than the consensus price target and that is also close to where the stock petered out in 2010.

Coach, Inc. (NYSE: COH) may be gutsy and may be an afterthought. It was recently given a strong tout by CNBC’s Jim Cramer as his luxury stock of choice, but on Friday it was raised started as ‘Buy’ with a target of $85 at Citigroup. This came on a day when the stock hit an all time high and closed at $74.54.

Coinstar, Inc. (NASDAQ: CSTR) is already up big over the last week, but we have never really considered it just as a value stock. Don’t tell that Zacks… On Friday it was named as Zacks’ Value Stock of the Day.

Filed under: 24/7 Wall St. Wire, Analyst Calls, The Week Tagged: AAPL, ALU, AMSC, AONE, COH, COP, CSCO, CSTR, DLR, IBM, LF, M, MMM, NLY, OPEN, POST, SIRI, SOHU, TRLG, ZOLT

24/7 Wall St. Closing Bell (COP, GILD, AMSC, MA, COH, LNKD, ATVI, CPST, GPRE, KONA, TRLG, LGF, MOVE, NBL, PCYC, ALU, FLIR, RUTH, FSLR, CIE, TBAC, RPXC, AMRS)

Paul Ausick — Fri, 10 Feb 2012 21:07:37 +0000

All three major US stock indexes opened lower this morning and the day was mostly a gentle slide for the rest of the trading session. The failed Greek debt deal weighed on futures this morning and nothing came along during the day to lift anyone’s spirits. US consumer sentiment fell slightly in January, the US trade deficit grew, and the federal budget deficit shrank, but now by enough to ignite buyers. Remarks by Fed chairman Bernanke on how to fix the housing mess didn’t offer anything new either. With equities and commodities all lower, the dollar index rose 0.523% today to 79.140. Crude oil is down today, with WTI down -1.04% at $98.80/barrel and Brent down -1.05% at $117.35/barrel. Gold settled down -0.9% at $1,725.30/ounce.

The unofficial closing bells put the DJIA down more than 89 points to 12,801.23 (-0.69%), the NASDAQ fell more than 23 points (-0.8%) to 2,903.88, and the S&P 500 fell -0.69% or more than 9 points to 1,342.64.

There were several analyst upgrades and downgrades today, including ConocoPhillips (NYSE: COP) raised to ‘buy’ at Deutsche Bank; Gilead Sciences Inc. (NASDAQ: GILD) started as ‘overweight’ at both Barclays and Morgan Stanley; American Superconductor Corp. (NASDAQ: AMSC) raised to ‘buy’ at Goldman Sachs; Mastercard Inc. (NYSE: MA) reiterated as ‘buy’ and target price raised to $450 at Argus; and Coach Inc. (NYSE: COH) started as ‘buy’ at Citigroup.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: LinkedIn Corp. (NASDAQ: LNKD) is up more than 18% at $90.44 (more coverage here); Activision Blizzard Inc. (NASDAQ: ATVI) is down -2.84% at $12.30; Capstone Turbine Corp. (NASDAQ: CPST) is down -9.8% at $1.26; Green Plains Renewable Energy Inc. (NASDAQ: GPRE) is down -3.5% at $11.20; Kona Grill Inc. (NASDAQ: KONA) is down -3.8% at $6.05; True Religion Apparel Inc. (NASDAQ: TRLG) is down more than -27% at $26.75; Lions Gate Entertainment Corp. (NYSE: LGF) is up 6.5% at $11.73 after posting a new 52-week high of $12.24 earlier today; Move Inc. (NASDAQ: MOVE) is up 14% at $8.65; Noble Energy Inc. (NYSE: NBL) is down -2.7% at $100.70; Pharmacyclics Inc. (NASDAQ: PCYC) is up more than 14% at $22.65 after posting a new 52-week high of $23.57 earlier today; Alcatel Lucent (NYSE: ALU) is up more than 13% at $2.2 (more coverage here); FLIR Systems Inc. (NASDAQ: FLIR) is down -3.3% at $24.90; and Ruth’s Hospitality Group Inc. (NASDAQ: RUTH) is up 3.2% at $6.19.

Other standouts from today include the following stocks:

First Solar Inc. (NASDAQ: FSLR) is down more than -10% at $43.94. The thin-film solar panel maker is having trouble meeting a financing requirement related to the sale of one of its solar farms to Exelon Corp. (NYSE: EXC). More coverage here.

Tandy Brands Accessories Inc. (NASDAQ: TBAC) is up nearly 71% at $1.77. The clothing accessories maker announced strong earnings and two new brand licensing agreements today.

Cobalt International Energy Inc. (NYSE: CIE) is up 35% at $32.27 after posting a new 52-week high of $36.51 earlier today. The independent oil & gas producer reported significantly better-than-expected flows from a test well offshore of Angola.

RPX Corp. (NASDAQ: RPXC) is up more than 11% at $19.21. The patent risk management company has a contract with Alcatel Lucent that could be very valuable as the larger company begins more aggressively to license its 29,000 patents.

Amyris Inc. (NASDAQ: AMRS) is down more than -28% at $6.95 after posting a new 52-week low of $6.85 earlier today. The biofuel maker’s stock was downgraded following a negative outlook from the company for 2012.

Stay tuned for Monday. We have noted the following events on the schedule (all times Eastern):

11:30 a.m. – 3- and 6-month Treasury bill auctions

Have a great weekend.

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: ALU, AMRS, AMSC, ATVI, CIE, COH, COP, CPST, FLIR, FSLR, GILD, GPRE, KONA, LGF, LNKD, MA, MOVE, NBL, PCYC, RPXC, RUTH, TBAC, TRLG

Top Analyst Upgrades & Downgrades (ALTR, AMSC, BIIB, CELG, COH, CSTR, COP, FSLR, GILD, HAIN, MA, RF, TRLG)

Administrator — Fri, 10 Feb 2012 13:23:06 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street brokerage and research firms this Friday morning.

Altera Corporation (NASDAQ: ALTR) Cut to Underperform as Bear of the Day at Zacks.
American Superconductor Corporation (NASDAQ: AMSC) Raised to Buy at Citigroup.
Biogen Idec Inc. (NASDAQ: BIIB) Started as Overweight at Morgan Stanley.
Celgene Corporation (NASDAQ: CELG) Started as Overweight at Morgan Stanley.
Coach, Inc. (NYSE: COH) Started as Buy at Citigroup.
Coinstar, Inc. (NASDAQ: CSTR) named as Value stock of the day at Zacks.
ConocoPhillips (NYSE: COP) Raised to Buy at Deutsche Bank.
First Solar, Inc. (NASDAQ: FSLR) Cut to Neutral at Collins Stewart.
Gilead Sciences Inc. (NASDAQ: GILD) Started as Overweight at Barclays; Started as Overweight at Morgan Stanley.
Hain Celestial Group (NASDAQ: HAIN) maintained Outperform and named as Bull of the Day at Zacks.
MasterCard Inc. (NYSE: MA) Reiterated Buy and raised target to $450 at Argus.
Regions Financial Corporation (NYSE: RF) Raised to Outperform at Credit Suisse.
True Religion Apparel, Inc. (NASDAQ: TRLG) Cut to Hold at Brean Murray.

If you enjoyed the top analyst calls, you can sign up in the box below to join our morning email list to receive news directly in your inbox each morning. We include major analyst upgrades and downgrades, IPO and M&A news, special situation developments, observations on Warren Buffett and key market gurus, as well as special exclusive feature stories.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Analyst Calls Tagged: ALTR, AMSC, BIIB, CELG, COH, COP, CSTR, FSLR, GILD, HAIN, MA, RF, TRLG

High-End Retail Lined Up for Holiday Sales Boost (TIF, SKS, M, JWN, RL, COH, WMT)

Administrator — Wed, 12 Oct 2011 14:40:37 +0000

British high-end clothier Burberry PLC reported that sales for its first six months of the year rose 30% on strong demand for its signature trenchcoats and accessories. The company noted that its revenue growth could slow down in the second half of the year, but attributed part of that to strong sales in the second half of last year. Does Burberry’s success point to a robust holiday season ahead for US luxury retailers?

High-end US retailers include Tiffany & Co. (NYSE: TIF), Saks Inc. (NYSE: SKS), the Bloomingdale’s stores owned by Macy’s Inc. (NYSE: M), Norstrom Inc. (NYSE: JWN), Polo Ralph Lauren Corp. (NYSE: RL), and Coach, Inc. (NYSE: COH). Same-store sales have been good at these retailers and the outlook for the third quarter for all has been very solid.

Tiffany doesn’t report monthly sales, but its second-quarter revenues were 24% higher year-over-year and same-store sales in the quarter rose 22%. Earnings rose 33% and the company posted adjusted EPS of $0.86, more than 20% higher than analysts expected. For the company’s fiscal year, which ends in January 2012, Tiffany expects a sales boost in the high-teens, a rise in operating margin of 1%, and an increase in EPS from a previously guided $3.45-$3.55 to $3.65-$3.75.

For Tiffany’s third quarter, analysts are expecting EPS of $0.60 on revenues of $806 million, rising to EPS of $1.64 on revenues of $1.27 billion in the fourth quarter. The third quarter revenue estimate is lower than the company’s second-quarter total. That is likely due to an expected drop in sales in emerging countries, particularly China, where growth in the sales of luxury goods is expected to fall as the country’s economy cools off.

Saks Fifth Avenue reported same-store sales growth of 9.3% in September and a two-month jump of 8.0%. For the year-to-date, Saks’ same-store sales are up 11.5%. For the current quarter, which ends this month, Saks is expected to post revenue of $698 million and EPS of $0.09. For its fourth quarter, expectations rise to EPS of $0.16 on revenue of $916 million.

Macy’s reported same-store sales rose 4.9% in September and said that sales for the third and fourth quarters would be at the high-end of guidance at 4%-4.5%. Analysts are forecasting that Macy’s third-quarter EPS will be $0.16, rising to $1.66 in the fourth quarter. Revenue for the third quarter is forecast at $5.88 billion, rising to $8.6 billion in the fourth quarter.

Nordstrom’s same-store sales jumped 10.7% in September, more than double analysts’ expectations. Third-quarter revenue is expected to reach $2.34 billion with EPS of $0.57. In the fourth quarter, revenue is expected to rise to $3.1 billion and EPS is forecast at $1.11.

Ralph Lauren does not report monthly sales. The company’s revenues are nearly equally split between its retail stores and its wholesale and licensing businesses. For the third quarter, analysts are expecting EPS of $2.23 on revenue of $1.84 billion. For the fourth quarter, EPS is expected to reach $1.74 on revenue of $1.77 billion. Compared with the same periods a year ago, third-quarter EPS is expected to rise nearly 7%, while fourth-quarter EPS is expected to rise by just over 1%.

Coach reported fiscal year 2011 numbers in August, including a jump in same-store sales of 10.6% for the year. For its first fiscal quarter of 2012, the company is expected to post EPS of $0.70 on revenue of $1.02 billion. For the second quarter, ending in December, EPS is expected to reach $1.14 on sales of $1.42 billion.

According to a recent survey, consumers with discretionary incomes above $250,000 plan to spend about 7% more during this year’s holiday season. [http://www.jckonline.com/2011/10/10/only-richest-consumers-spending-more-this-holiday] Those with incomes between $100,000 and $250,000, however, are expecting to spend about 17% less. For those with incomes below $100,000, spending will fall by 28%.

Those with discretionary incomes above $100,000 who say they plan to spend less this year are not worried about the economy. They claim that they already have too much stuff.

At the other end of the spectrum, an indicator of expectations at the lower end of the income distribution is the number of containers arriving at US ports. The Port of Long Beach is expecting a 15% drop year-over-year from last September, and the number of containers coming into New York-New Jersey is only flat with last year.

Jewelry and high-end handbags don’t make up those shipments, but goods headed to Wal-Mart Stores Inc. (NYSE: WMT) do. That pretty well sums up the state of the US economy and this year’s outlook for holiday sales.

Paul Ausick

Filed under: Apparel, Economy, Luxury, Retail Tagged: COH, JWN, M, RL, SKS, TIF, WMT