LTD Comps Up 2% - Analyst Blog
May 13 2013 - 1:22PM
Zacks
L Brands, Inc. (LTD) formerly known as Limited
Brands, posted comparable-store sales growth of 2% for the
four-week period ended May 4, 2013. This specialty retailer of
women’s intimate and other apparel, beauty and personal care
products showcased a disappointing performance.
We observe that the rate of comps growth in April for this Zacks
Rank #3 (Hold) stock fell by 100 basis points with that of March
and February but decelerated sharply from an increase of 9% in Jan
2013. Management now projects comparable-store sales to rise in the
low single-digit for the month of May.
Comparable-store sales for April increased 2% at Victoria’s
Secret Stores & Victoria’s Secret Beauty, 2% at La Senza and 4%
at Bath & Body Works & The White Barn Candle Co. However,
sales dropped 4% at Victoria’s Secret Direct.
Limited Brands said that net sales for April rose marginally to
$660.5 million from $659 million posted in the comparable
prior-year month.
For the thirteen-week period ended May 4, 2013, comparable-store
sales jumped 3%, whereas net sales rose 5% to $2,268 million from
$2,154 million in the year-ago period.
As a whole, most retailers were able to put up a decent
comparable-store sales performance for the month of April, despite
challenges arising from higher Social Security Payroll taxes, an
unexpected cold weather, and political gridlock and
brinkmanship.
Retailers like The TJX Companies, Inc. (TJX),
Ross Stores Inc. (ROST) and Buckle
Inc. (BKE) witnessed comps increase of 8%, 7% and 6.2%,
respectively.
Let’s Conclude
Limited Brands’ Bath & Body Works segment is gaining
traction, driven by a rise in store transactions, enhancement in
the direct channel business and new stores. Victoria’s Secret
Stores have been performing well and the company is revamping its
La Senza brand alongside.
Limited Brands is keen on augmenting its retail footprint across
the globe by expanding aggressively in Canada and other
international markets. Moreover, the company’s strong liquidity
positions it for growth and higher returns. However, stiff
competition and erratic consumer behavior still remain matters of
concern.
Limited Brands, which is slated to release its first-quarter
fiscal 2013 results after the market closes on May 22, now projects
earnings of 46 cents a share in line with the Zacks Consensus
Estimate. Earlier, the company had forecasted earnings between 40
cents and 45 cents a share for the quarter.
BUCKLE INC (BKE): Free Stock Analysis Report
L BRANDS INC (LTD): Free Stock Analysis Report
ROSS STORES (ROST): Free Stock Analysis Report
TJX COS INC NEW (TJX): Free Stock Analysis Report
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