Ross Stores Soar Defy Retail Downturn; Foot Locker, Hibbett Tumbles

Mukesh Buch
18 Aug, 2017
New York City

Deere & Co net soared 31% on strong demand. Estee Lauder net more than doubled and lifted fiscal outlook. Foot Locker tumbled after profit declined 60%. Gap net soared 117%. Hibbett Sports comparable sales plunged 12% and lowered fiscal outlook. Ross Stores net surged 12%.

[R]12:15 PM New York – Deere & Co net soared 31% on strong demand. Estee Lauder net more than doubled and lifted fiscal outlook. Foot Locker tumbled after profit declined 60%. Gap net soared 117%. Hibbett Sports comparable sales plunged 12% and lowered fiscal outlook. Ross Stores net surged 12%.[/R]

Tollbooth Index edged up 6.71 to 12,075.58.

Earnings Review

Deere & Company ((DE)) plunged 6.9% or $8.55 to $115.43 after the agriculture, turf and construction equipment maker reported revenues in the third-quarter ending in July surged 16% from a year ago to $7.8 billion.

Net income in the quarter soared 31.3% to $641.8 million or $1.97 per diluted share from $488.8 million or $1.55 in the same quarter last year.

The construction equipment maker said strong growth was driven by improved farm and construction equipment markets.

John Deere forecasted fiscal 2017 sales to jump 11% and surge 24% in the fourth-quarter and net income in the year of about $2.1 billion.

Estee Lauder Companies Inc ((EL)) surged 7% or $6.90 to $105.22 after the cosmetics maker said revenues in the fourth-quarter ending in June jumped 9% from a year ago to $2.9 billion.

Net income in the quarter more than doubled to $229 million or 61 cents per diluted share from $94 million or 25 cents in the same quarter last year.

The cosmetics maker said higher profit was driven by strong demand in recently acquired brands Too Faced and BECCA.

In the fiscal first-quarter 2018, net sales to jump between 9% and 10% and diluted earnings per share in the range of 94 cents to 97 cents.

Estee Lauder forecasted fiscal 2018 net sales to increase between 8% and 9% and diluted earnings per share in the range of $3.87 and $3.94.

Foot Locker, Inc ((FL)) tumbled 26.9% or $12.83 to $34.88 after the shoes and apparel retailer said net sales in the second-quarter ending on July 29 slumped 4.5% from a year ago to $1.7 billion.

Comparable store sales in the quarter declined 6%.

Net income in the quarter tumbled 59.8% to $51 million or 39 cents per diluted share from $127 million or 94 cents in the same quarter last year.

“We expect comparable sales to be down three to four percent over the remainder of the year,"" said chairman and chief executive officer Richard Johnson.

He added ""sales of some recent top styles fell well short of our expectations. At the same time, we were affected by the limited availability of innovative new products in the market.

The Gap, Inc ((GPS)) slipped 1.5% or 34 cents to $22.34 after the apparel and personal care products retailer reported net sales in the second-quarter ending on July 29 fell 1.3% from a year ago to $3.8 billion.

Comparable store sales in the quarter increased 1%.

Net income in the quarter soared 116.8% to $271 million or 68 cents per diluted share from $125 million or 31 cents in the same quarter last year.

The Gap estimated fiscal 2017 diluted earnings per share in the range of $2.12 to $2.20 and comparable sales for fiscal year 2017 to be flat to slightly up and net sales slightly below this range.

Hibbett Sports, Inc ((HIBB)) plunged 11.9% or $1.38 to $10.12 after the athletic specialty stores stated net sales in the second-quarter ending on July 29 dropped 9.2% from a year ago to $188 million.

Comparable store sales in the quarter plummeted 11.7%.

Net in the quarter swung to a loss of $3.2 million or 15 cents per diluted share from profit of $6.5 million or 29 cents in the same quarter last year.

The specialty stores operator lowered fiscal 2017 diluted earnings per share forecast in the range of $1.25 to $1.35 from earlier estimate of $2.35 to $2.55 and comparable store sales in negative mid to high single-digit range compared to previous guidance of negative 1% to positive 1%.

Ross Stores, Inc ((ROST)) soared 10% or $5.34 to $58.68 after the apparel and home fashion retailer reported net sales in the second-quarter ending on July 29 jumped 8% from a year ago to $3.4 billion.

Comparable store sales in the quarter advanced 4%.

Net income in the quarter surged 12.4% to $317 million or 82 cents per diluted share from $282 million or 71 cents in the same quarter last year.