Retailers Dismayed as Post-Holiday Stock Prices Tumble
Several major retailers got hit with serious cases of the post-holiday blues on Thursday as their after-hours stock prices tumbled after a challenging holiday season.
Familiar retail chains — including Sears and J.C. Penney — saw stock prices decline in after-hours trading even as several retailers slashed their fiscal fourth-quarter profit forecasts this week.
Among the hardest hit was Sears Holding Corp., whose share tumbled 13% in after-hours trading on Thursday after the company, which also owns Kmart, reported a 7.4% decline in quarter-to-date holiday season comp sales. Both Sears stores and Kmart stores felt the pressure, with Sears comp sales in the U.S. down 9.2% and Kmart sales down 5.7%.
Gap also got hit as it reported its December same-store sales were flat, missing estimates of a 1.5% gain. And in after-hours trading, J.C. Penney was down almost 2% to $7.55.
For retailers, it was an especially disappointing holiday season as many budget-conscious and price-conscious shoppers who waited and waited for holiday bargains, never jumped in. Then, there was the wild winter weather factor, which kept many would-be shoppers in their homes and out of the stores. On top of all this, the quirky holiday shopping calendar resulted in six fewer shopping days between Thanksgiving and Christmas.
“This was a holiday season that most stores would like to forget,” said Ken Perkins, president of Retail Metrics, a research firm.
SOURCE: Bruce Horovitz