Investors hoping to see some improvement in Men's Wearhouse
I've noticed apparel retailers such as Kohl's
With comp sales down 8%, the rest of the profit-and-loss statement is predictable. Gross margin slid 27 basis points. Selling, general, and administrative expenses dramatically increased as a percentage of sales, and the adjusted earnings per share of $0.72 was well below last year's $1.00 but did manage to beat consensus analyst estimates by a penny. The one piece of encouraging news was the tuxedo rental business that Men's Wearhouse acquired from Macy's
Management lowered its guidance for 2008 again, this time to a range of $1.50-$1.60 excluding one-time items. At the beginning of the year, the number was $1.90-$2.10, but management has had a few "opportunities" with earnings guidance in recent quarters.
Today, the company sports a trailing-12-month price-to-earnings ratio of 9. That might seem reasonable, but at the current price of $21 a stub, that's really closer to 13.5 times expected earnings this year -- not much of a bargain, when Foolish investors who believe in the sector can own Jos. A. Bank
For related Foolishness:
Fool contributor Timothy M. Otte surveys the retail scene from Dallas. He welcomes comments on his articles but doesn't own shares in any of the companies mentioned in this article. The Fool has a disclosure policy.