Stocks are moving higher even though homebuilders delivered the news that activity had declined and oil has slipped to $42 a barrel.
The S&P 500 rose 9 points to trade at 2,149, the Dow Jones Industrial average gained 89 points to trade at 18,209 and the Nasdaq added 27 points to trade at 5,261. The S&P Retail ETF slipped by 11 cents to sell at $43.57.
Ascena Retail Group, Inc. stock plunges over 26 percent to $5.97 and nears a 7 year low after the retailer reported that its missed its fourth quarter earnings expectations. The home of the Ann Taylor and Lane Bryant stores said traffic and comps were down double-digits. The company is also trying to wean its customers off of promotions, but that is turning out harder than expected. Analysts like Brian Tunick of RBC Capital Markets downgraded the stock, saying he had been “flat out wrong” when he upgraded it last June. The abandonment by Wall Street caused shareholders to give up and throw in the towel. The next catalyst for the company is the October investor day, but that is only expected to bring more bad news.
Tailored Brands Inc. appointed Julie MacMedan as its new president of investor relations. MacMedan has held similar roles at Demand Media Inc. and THQ Inc. Tailored Brands, which owns Men’s Wearhouse recently beat its second quarter earnings estimates and has seen the stock recover from its summer lows. Overall, the stock is up 17 percent for the past year and was lately dropping by 8 cents to $16.46.
Sears Holdings Corporation stock is dropping over 1 percent to trade at $11.60. as the market digests news that it is closing 64 Kmart stores in the U.S. as liquidation sales begin on Sept. 22. The stores will close in mid-December. The latest group includes 17 stores that had been sold to Seritage Growth Properties in a deal that included a provision that allowed Sears the option to vacate the store if it was losing money. Sears has been selling off real estate assets to come up with cash as sales slow. The company has also closed more than 400 Kmart’s over the past 5 years and Moody’s downgraded Sears last week saying the retailer is too reliant on selling assets to cover losses.
Columbia Sportswear Company was upgraded by Canaccord Genuity consumer analyst Camilo Lyon from hold to buy. Lyon wrote, “We are upgrading the shares to BUY from Hold as we believe both macro and idiosyncratic factors are improving. We see the pieces in place for upside to our 2H16 revenue and earnings estimates, and more importantly, a return to HSD revenue growth and mid- teens EPS growth in 2017.” The price target was raised from $59 to $72. The stock was lately trading at $56.27 and was rising over 2 percent this morning.