Of the retailers posting July same-store sales Thursday, Dress Barn Inc. delivered results that were ahead of expectations, while the major drug chains reported strong comps.
Junior apparel retailer Deb Shops Inc. — which last week was bought by Lee Equity Partners and tapped Allen Questrom as non-executive chairman — saw a 2 percent drop in same-store sales, while Dress Barn reported a 3 percent increase. Most retailers will be posting their comps next Thursday. Analysts expect luxury to perform well, and see mixed results from the specialty apparel arena.
Dress Barn's results exceeded analysts' expectations, buoyed by strong sales at the Maurices division, said Mark Montagna, specialty analyst at CL King and Associates, in a research note.
Maurices is expected to continue driving Dress Barn's profits. "The recent addition of women's plus sizes and the removal of men's at Maurices should boost productivity and profits at the Maurices division," Montagna said in the note.
At Maurices, same-store sales spiked 13 percent, while Dress Barn's comps fell 1 percent for the month.
"We believe the combination of Dress Barn's compellingly low valuation and its relatively lower-risk future prospects make this an opportune time to aggressively buy shares of Dress Barn," Montagna said.
In the drug channel, Walgreen Co. stood out among the chains with a 7.2 percent jump in July same-store sales. While new generic medicines negatively affected the company's comps by 4.5 percent, calendar shifts tempered the impact.
CVS Corp. posted a 5.2 percent improvement and also blamed generic medicine introductions for faltering pharmacy sales. Rite Aid Corp. comparable sales increased 1.6 percent, with pharmacy same-store sales showing a 2.1 percent improvement from last year.
A Stella McCartney sketch of a custom dress made from protein-based silk in partnership with biotech lab Bolt Threads. The dress will be displayed at The Museum of Modern Art's upcoming design exhibition, "Items: Is Fashion Modern?"