In Brief: Happy Holidays … Dropping Wet Seal … Homeward Bound
HAPPY HOLIDAYS: Wal-Mart Stores Inc. chief executive officer Lee Scott told analysts during a conference at the retailer’s headquarters in Bentonville, Ark., that he was optimistic about the upcoming holiday shopping season despite higher...
HAPPY HOLIDAYS: Wal-Mart Stores Inc. chief executive officer Lee Scott told analysts during a conference at the retailer’s headquarters in Bentonville, Ark., that he was optimistic about the upcoming holiday shopping season despite higher energy prices impacting the retailer’s core customers. The ceo also said he sees strength in the economy and expects the company to finish the year on a high note. For the third quarter, earnings per share are pegged to come in at the low end of the retailer’s forecast of between 52 cents and 54 cents. EPS for the year are expected to be between $2.36 and $2.40.
DROPPING WET SEAL: Wachovia Securities dropped coverage of The Wet Seal Inc. on Tuesday. Analyst Joseph Teklits said the retailer “is either headed for Chapter 11, which is why we have maintained our ‘underperform’ rating, or will be acquired by a strategic or financial investor for a value that exceeds what is justified by the company’s valuation on a stand-alone basis.” He said in his research note that Wet Seal has “deteriorated significantly” under new leadership, and that the new merchandising changes for fall “failed badly.” Teklits noted there are private equity groups and competitors who are likely trying to gauge whether there is sufficient value in the Arden B. division to offset the risks of running the Wet Seal store operation. Unless a buyer sees values for the chain, he wrote, shares of Wet Seal could be “worthless over the next 12 months.”
HOMEWARD BOUND: Gottschalks Inc. named Donald Engelman as vice president and general merchandise manager of the company’s home store division. Engelman will oversee the unit and its mix of housewares, tabletop, textiles and furniture. A 25-year veteran of the retail industry, Engelman was formerly the vice president and divisional merchandise manager of tabletop and gifts at the May Department Stores Co. Fresno, Calif.-based Gottschalks operates 73 units and is celebrating its 100th anniversary this year. Engelman will report to Gary Gladding, executive vice president of merchandising.
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