Quote:Like its fading rival, Kohl's is struggling to overcome a persistently sluggish economy, and people are finally waking up to it not being as strong as previously thought: high unemployment, a lack of new-jobs creation, real disposable income plunging the most in 40 years, median household incomes falling for five straight years, total consumer debt now 22% higher than it was three years ago, and student loan debt 61% higher.
Needless to say, the middle class is getting slaughtered, and these are hardly conditions conducive to recovery. Mid-tier retailers like Kohl's and Penney are being taken down with them.
Yet Kohl's is laying a lot of blame for the poor quarter on January store traffic. Without enough clearance merchandise to put out on sale, customers failed to show up as expected, which compounded problems it apparently experienced with its new e-commerce site that caused it to have higher-than-expected expenses. Full-year earnings are now anticipated to come in at $4.03 per share, compared to its previous forecast of $4.08 to $4.23 per share.
The retail landscape is desolate. J.C. Penney was going up against some of the easiest comps in its history and managed to just squeak out a 2% increase for the quarter and a mere 3% rise for the two-month holiday period. Best Buy reported a near-3% drop for the nine-week period, while Sears Holdings comps were down a whopping 9%. Others including Wal-Mart warned of a slow quarter with lower same-store sales expected, RadioShack will be shuttering 500 stores, and even the more financially fit Macy's will be implementing a similar store-closing strategy, albeit on a smaller scale (and its comps for the period were 4% higher).
I've been warning investors for months to stay away from retailers because it was clear early on that their numbers were going to come in much worse than expected, and now the shoes are dropping all over the sector.
http://www.fool.com/investing/general/2014/02/08/kohls-is-starting-to-make-jc-penney-look-good.aspx
The disaster that is retailing has been a constant subject of discussion here at A2K, but the experts are finally catching on.
JCP is dead company wallking
SEARS/KMART is shedding costs and assets to keep the dollars flowing short term to stock and bond holders but the business is a disaster and they are not lifting a finger to improve things. A couple more years of this and there will be no way to save either brand, they will all close.
Kohl's is a horribly run company, and unless they get their act together it is hard to see how there is room in the newly smaller retail pie for them.
RADIO SHACK is on their third or fourth attempt at rebranding, which has never worked and probably will not work now, they are almost certainly done.
BEST BUY might be able to figure out a way to go forwards, but CHRISTMAS sucked.
