American retailing’s monthly same-store sales reporting ritual is about to get hit by a case of empty-nest syndrome.

This story first appeared in the February 2, 2011 issue of WWD. Subscribe Today.

Following reports on January sales this Thursday, the list of retailers participating in the comparable-store routine will get three companies shorter when the three A’s of teen retailing — Abercrombie & Fitch Co., American Eagle Outfitters Inc. and Aéropostale Inc. — end their participation.

Although the move is part of a larger trend among companies seeking refuge from the spotlight of monthly disclosure, the recent developments could be more indicative of precipitous pressure in the teen space, according to analysts.

“Teen has been an overstored segment,” said Weeden & Co. analyst Amy Noblin. “There had been oversupply and underdemand in teen for a while.”

Noblin’s words sound oddly familiar. Misses’ retailers were also scrutinized for being overstored and lacking differentiated, fashionable merchandise. As a result, from 2006 to 2009, seven out of eight misses’ retailers ceased reporting monthly comps, leaving Cato Corp. as the sole survivor from its sector reporting to date.

What began with Talbots Inc. cutting ranks five years ago quickly turned into a mass exodus in the segment in the years to follow. Could teen retailers do the same thing?

“Possibly,” Noblin said. “From the retailer’s perspective, for them, it’s about the real underlying trend.”

And that trend has a lot to do with unoriginal, uninspired apparel, according to many analysts, who said the teen uniform of hoodies, jeans and graphic Ts just doesn’t cut it anymore. The consensus is that fashion-hungry teens are looking more to the H&Ms, Zaras and Forever 21s of the world.

But Noblin noted that Abercrombie had considered the move for some time, mainly because its promotional gift card redemptions only filter through at the end of a quarter and aren’t necessarily reflected in monthly comps.

“Aéropostale and American Eagle have been waiting for an excuse to stop reporting monthly, and Abercrombie’s decision was the nail in the coffin,” she said. Both companies have struggled since Abercrombie became more aggressive on price, a tactic it had previously eschewed.

“I don’t think there’s a lot of upside to reporting on a monthly basis, even if the results are positive,” agreed Citi analyst Jeff Black.

Even so, Black said he doesn’t foresee heavy hitters like Gap Inc., Limited Brands Inc., The TJX Cos. Inc. or Ross Stores Inc. jumping on the bandwagon.

But never say never. When retail giant Wal-Mart Stores Inc. stopped reporting same-store sales in May 2009, it not only crystallized the volatility of the market — and severely depleted the comp sample — but also called into question the importance of same-store sales as a barometer for the retail industry. Macy’s withdrew in January 2008 only to return 10 months later as its business improved.

“A lot of management teams have realized that if they are going through business expansion, any strategic changes or a turnaround, doing that out of the limelight…is advantageous,” said Michael Dart, head of private equity at Kurt Salmon. “It diminishes pressure.”

When retailers “miss forecasts it affects consumer psychology,” he said. “The brand can be tarnished.”

Dart further explained that even when retailers meet or exceed comp expectations, the consumer “doesn’t pay attention” and a stock rally isn’t guaranteed.

Visibility to the investment community is the best argument for retailers to continue reporting, he said, adding that if a company isn’t in the process of making major changes, then it’s beneficial to remain transparent.

He also noted that if a business needs to raise capital, then reporting could be positive, as well.

In the teen space, a segment wrought with promotional one-upmanship, more retailers may take cover from the glaring monthly spotlight.

Not teen retailer Zumiez Inc., however, according to Weeden’s Noblin. With recent waves of soaring double-digit comp increases, the West Coast-inspired retailer “likes the transparency” on the “pace of the business,” she said.

But for those retailers licking their wounds, it might be a perfect time to retreat.

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