Mall Retailers Tumble on Fresh Concerns About Apparel Demandby
It’s been another rough day at the mall.
Shares of Aeropostale Inc., Express Inc. and American Eagle Outfitters Inc. -- three apparel chains that target teens and 20-somethings -- all tumbled on Thursday after earnings results renewed concerns that the market is in a slump. PVH Corp., which makes clothing under Calvin Klein and Tommy Hilfiger brands, also fell after its sales missed analysts’ estimates.
Aeropostale, which has struggled to rebound from years of losses, was hit especially hard. Its stock declined as much as 41 percent, the biggest intraday plunge since 2002, after predicting a loss of as much as 17 cents a share in the fourth quarter. Analysts had projected a profit of 2 cents in the period, which typically brings a flood of sales to retailers.
Mall traffic has slowed in recent years, and early signs from this holiday period suggest that more Americans are shopping online. U.S. consumer spending at brick-and-mortar retail locations fell 10 percent to $20.4 billion over the four-day Thanksgiving weekend, according to ShopperTrak.
Even companies that appear to be performing well are getting swept up in the pessimism. Express beat analysts’ estimates with its third-quarter results and predicted earnings in the fourth quarter of 60 cents to 64 cents. The midpoint of that range was above the average projection. Still, the stock dropped as much as 8.9 percent to $15.84, its worst performance in more than 10 months.
American Eagle fell as much as 4.9 percent to $15.03. And PVH suffered a 10 percent drop, its biggest decline in more than four years. Ascena Retail Group Inc., owner of the Ann Taylor, Lane Bryant and Dressbarn brands, dropped as much as 10 percent as well.