Recent quarterly news from retailers has underlined that many are still struggling. Although some have beat profit expectations, their revenue and same-store sales data have told the tale that customer traffic is flagging. However, a few retailers have been displaying remarkable resilience, and they're good for investors' watch lists.
When "better" isn’t really that great
If you've missed the trend I'm speaking of, look no further than Gap's
It's not exactly heartening, even if it's better than analysts thought Gap could achieve.
Of course, Gap's less-than-exciting tidings aren't exactly the exception to the rule in retail lately. For example, Whole Foods Market's
It is an ugly time, with consumers fretting about job losses and trying to pay down debt and amass savings, so lackluster profits and sales from retailers don't seem like a shocking state of affairs. However, more interesting is that two retailers in particular have been doing really well, despite the ugly macroeconomic environment.
Different than the rest, in a good way
Teen retailer Buckle
Another teen retailer, Aeropostale
Aeropostale's revenue jumped 21%, to $408 million, and same-store sales leapt 11%, and that's on top of last year's 10% increase in comps.
High-fashion stocks for the long term
Buckle and Aeropostale's performances aren't that big of a surprise either; last January I noted that these two retailers were holding up surprisingly well in the ugly macroeconomic climate, and it wasn't even a particularly new development then. (Here's an article from last September that also illustrates the recurring positive theme with these two retailers.)
Another reason to find Buckle and Aeropostale fashionable is that both have cash on their balance sheets and no debt.
There's really something to be said for their consistent success, what with so many retailers weighed down with debt, struggling with turnarounds that pre-dated the ugly macro environment, and hard-pressed to get customers in the door. Why mess with Hot Topic
Buckle and Aeropostale are two retailers that are really doing something right, given their stellar results, and that makes them great stock ideas for investors.
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