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Easy comparisons and relatively favorable weather helped increase same-store sales in the typically weak month of October for retailers, up 1.8% from the year-earlier level but below the 2% growth expectation. Results for this series, which tracks data for stores open at least a year from 30 major retailers, had come ahead of expectations the [...]

($WMT) Easy Comparisons Help Retail Sales

For Immediate Release

Chicago, IL – November 6, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ambercrombie & Fitch Co. (ANF), Costco (COST), Target (TGT), Walgreen Co. (WAG) and Rite Aid (RAD).

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Here are highlights from Thursday’s AnalystBlog:

Easy Comps Help Retail Sales

Among teen retailers, Ambercrombie & Fitch Co. (ANF) posted weaker-than-expected results, with same-store sales down 15%. Among discounters, Costco (COST) had strong numbers, beating expectations; while Target’s (TGT) 0.1% decline was below the flat-results. Walgreen Co. (WAG) reported strong same-store sales numbers, maintaining its momentum from the previous month, while Rite Aid (RAD) continued to struggle.

While the economy has come out of the recession, the consumer is still hard pressed, given the dismal labor market and continued housing overhang. With another employment report due tomorrow -- and expectations of around 170,000 jobs lost in October -- any meaningful improvement in the retail scene will have to wait a turnaround in the labor market.

The saving grace for retailers in their fiscal third quarter results (typically ends October 30th) is the relatively easier comparison with the extremely bad 2008.

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Easy comparisons and relatively favorable weather helped increase same-store sales in the typically weak month of October for retailers, up 1.8% from the year-earlier level but below the 2% growth expectation. Results for this series, which tracks data for stores open at least a year from 30 major retailers, had come ahead of expectations the last two months.

As a result of the financial crisis last fall, conditions were extremely bad in October of last year, when retail sales were down 4.1%.

October is typically a weak month for retailers, sandwiched as it is between the active shopping periods of back-to-school and the holiday season. The monthly sales numbers do not include data from Wal-Mart (WMT), which stopped giving monthly sales numbers earlier this year.

Results were mixed among the major retail categories, particularly department stores and teen retailers. Sales at Macy’s (M) and JC Penney Co. (JCP) were down 0.8% and 4.5% from last year’s levels, respectively, coming in below expectations. Nordstrom’s (JWN) sales came in better than expected.

Among teen retailers, Ambercrombie & Fitch Co. (ANF) posted weaker-than-expected results, with same-store sales down 15%. Results were also weak at American Eagle Outfitters (AEO) and Zumiez Inc. (ZUMZ). Sales at some other teen retailers, such as Buckle (BKE), came in ahead of expectations.

Among discounters, Costco (COST) had strong numbers, beating expectations; while Target’s (TGT) 0.1% decline was below the flat-results. Walgreen Co. (WAG) reported strong same-store sales numbers, maintaining its momentum from the previous month, while Rite Aid (RAD) continued to struggle.

While the economy has come out of the recession, the consumer is still hard pressed, given the dismal labor market and continued housing overhang. With another employment report due tomorrow -- and expectations of around 170,000 jobs lost in October -- any meaningful improvement in the retail scene will have to wait a turnaround in the labor market.

The saving grace for retailers in their fiscal third quarter results (typically ends October 30th) is the relatively easier comparison with the extremely bad 2008.
Read the full analyst report on "WMT"
Read the full analyst report on "M"
Read the full analyst report on "JCP"
Read the full analyst report on "JWN"
Read the full analyst report on "ANF"
Read the full analyst report on "AEO"
Read the full analyst report on "ZUMZ"
Read the full analyst report on "BKE"
Read the full analyst report on "COST"
Read the full analyst report on "TGT"
Read the full analyst report on "WAG"
Zacks Investment Research

Management at Rite Aid Corporation (RAD) was executing a turnaround strategy centered on increasing the profitability of the existing store base. However, the acquisition of Brooks Eckerd prior to a convincing turnaround in profitability has increased the debt burden and interest expense. Moreover, Wal-Mart’s foray into the retail generic drug market has pressured the company’s pharmacy [...]

(RAD) Rite Aid Corporation – Bear of the Day

Tom Dorsey and Sue Morrison - Alternatives in the Red Zone

Wow, Rite Aid Corporation (NYSE:RAD) shares hit $1.48 this morning after reporting a Q1 2008 loss of $156.6 million. So take the Pepsi Challenge, buy a 16 oz. soda from any vending machine or for a few pennies less, invest in Rite Aid?

In the past year, RAD shares have lost 75% of their value. 

read more

Two Veteran Wall Street Analysts Review the March 28, 2008 Edition of the Value Line Investment Survey

Two Veteran Wall Street Analysts Review the December 28, 2007 Edition of the Value Line Investment Survey

It's almost Christmas and then New Year's and right into 2008.  By 2010 we'll all be on a space odyssey to Jupiter talking to our robot friend HAL-9000 and exploring the new Planet Starbucks (since corporations will now be into deep space exploration).

But until that time, let's take a look at a few stocks that could bounce back in the coming week. 

Let's get to some of the stocks that are under $10, right off the bat -- Rite Aid (RAD).  Rite Aid Corp. wet the bed yesterday when they reported Q3 earnings. The stock is now trading just under $3 a share down from a 52-week high of $6.47.  The Masters wrote about Rite Aid yesterday so for more details on their financial performance, here's the article - Rite Aid Corp. now selling for $3 a share 

All RAD needs is a little love from Wall Street, one good article written by somebody important and this stock will jump 10% in a heartbeat.  They've got over 3,000 stores, and even if we fall into a recession sooner than later, people need their drugs and prescriptions.  Rite Aid will weather the storm.

Then there's Micron Technology (MU) this stock is just a paper weight that can't move.  Now it's less than a Dime above it's 52-week low, trading around $7.50 a share.  Micron got another thumbs down from Wall Street today, Robert W Baird reiterated their "outperform" rating on Micron while reducing their estimates for the company. The target price has been reduced from $17 to $13.  Still $13 is a huge leap from where shares currently stand, and for a 1 year estimate, the stock could jump 50 cents before the HAL-9000 or better yet the AWESOM-O 4000 makes your latte or inserts your suppository.

Executives at Micron Technology Inc. (MU) said Thursday they are looking at partnership opportunities for their DRAM memory business, where a difficult environment of rapid price declines is rattling the market.

Micron thinks a partnership could be particularly beneficial in allowing it to share development costs with any partners, although it would also expect benefits in manufacturing capacity. Demand for DRAM and NAND memory products are strong, driven by the PC and mobile-phone markets. And sharply higher unit shipments enabled Micron to achieve 7% revenue growth from the fourth quarter. However, a supply glut has pushed prices down precipitously, leading Micron to post losses.  Come on Micron, let's get a bounce before Butters needs another suppository.

Washington Mutual (WM) has made a mess of their company and now shares are trading in the high $13 range.  Thanks to their greed and subprime lending, their chance to ever get back to their 52-week high of $46 a share will take them at least 10 years but I'm betting they get bought out before then. Everyone hates WaMu and with the SEC investigating how they handled and reported on mortgage loans which may have been based on inflated home appraisals is yet another nail in the coffin.  I dare you to try a positive article written on WaMu these days, there's isn't one. Countrywide (CFC) is worse than WaMu, but these stocks will bounce on any good news.  The Masters will roll the dice on WM before CFC, corporate greed and karma made a great Christmas present for their employees.

Then you've got some riskier bets but I still like em:

Ruth's Chris Steak House, Inc. (RUTH) now at $9 a share, they are going to be hurting for a long time but with the stock so low it could jump 25 cents in the next month or so.

The Finish Line, Inc. (FINL) at $2.84, for lack of a better term, this company sucks, but I like the odds under $3.

But how about some safer bets? That would be Eddie Lampert and Sears Holdings Corp. (SHLD) now at $100 a share, sounds pricey but it's not, you get what you pay for. 

My favorite stock right now is VASCO Data Security Intl, Inc. (VDSI), I can't say enough good things about that company.  With shares trading at $25 despite their 25% rally since hitting rock bottom in the last month, it's still a great buy. We've been pimping VDSI since it's big fall in Oct. - Nov. here an article we wrote last month: VASCO Data Security (VDSI) and the 50% Drop

Happy trading out there and take your gains when you have them, a recession is coming.  Even the HAL-9000 can't stop the American economy from sinking.  Turns out at theStockMasters HQ we have a HAL-9000 still running on our C64.  Our intern Dave asked HAL if he could tell us what Americans could do to prevent falling into a recession.  HAL's answer was the following:
"I'm Sorry, Dave. I'm Afraid I Can't Do That."

Like what you've read? Our real stock picks are just a click away, learn more .

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Article by Mark Cheshier 

Contributor at TheStockMasters.com

Disclaimer: The Author does not hold any positions or shares in the securities mentioned in this publication.