Movers: Target, Lowe's, TJX, Deckers, Children's Place, Ross Stores

Barry Adams
18 May, 2022
New York City

Retail stocks plunged after Target reported weak results and Lowe's sales were below expectations. 

Dollar Tree declined 17%, Dollar General fell 12.3%, Five Below declined 7.5%, Costco Wholesale Corp dropped 11.6%, Macy's edged down 5%, and Best Buy, Ulta Beauty, Autozone, and Advance Auto Parts dropped 8%.  

Lowe's Companies declined 4% to $186.22 after the home improvement retailer reported fiscal first quarter ending in April net sales declined to $23.66 billion from $24.42 billion a year ago. 

The retailer reiterated its full-year sales outlook between $97 billion and $99 billion and same store sales to range between a decline of 1% and an increase of 1%. 

Target Cop plunged 24% to $163.31 after the retailer reported weaker than expected earnings on rising inventory problems, higher market downs, and wage pressures. 

GAAP earnings per share in the first quarter declined 48% to $2.16 from $4.17 after sales increased 4% to $24.83 billion from a year ago. 

Net earnings in the quarter fell 52% to $1.0 billion from $2.1 billion a year ago. 

First quarter operating income margin rate was 5.3% compared to 9.8% in 2021 and gross margin rate was 25.7% declined from 30.0 percent in 2021. 

"This year's gross margin rate reflected higher markdown rates, driven largely by inventory impairments and actions taken to address lower-than-expected sales in discretionary categories, as well as costs related to freight, supply chain disruptions, and increased compensation and headcount in our distribution centers." the retailer noted in a press release. 

TJX Companies soared 8.5% to $60.95 after the apparel and home goods retailer reported net sales in the first quarter ending in April increased 13% to $11.4 billion and net income rose 10% to $587 million.  

Total inventories rose 42% to $7.0 billion and said in the earnings release overall availability of quality, branded merchandise in the marketplace remains excellent" for the summer season. 

Ross Stores jumped 1.2% on the back of TJX earnings and inventory comments and ahead of earnings tomorrow after the close of market. 

Children's Place declined 10.5% to $43.20 ahead of the earnings release and conference call tomorrow morning at 8:00 a.m. ET. 

Deckers Outdoor Corp declined 7.6% to $225.65 ahead of the earnings call tomorrow after the close of market.