Last week, Kapitall reported optimistic sentiment among retailers for this year's holiday season, spurred by a more cautious approach to inventory and encouraging changes in consumer sentiment. But not everyone is sold on the cheery holiday sales forecasts.
Companies that ship and transport retailer's goods don't see their order forms adding up to the optimistic expectations of 5%-6% growth in same store sales.
New York Times reports holiday orders, which arrive in stores by late October, typically start to pile into U.S. ports in August and September. But Long Beach, the second-busiest container port by volume in the U.S., reported August 2011 imports to be 14.2% lower than 2010 volumes. September volumes, not yet released, are expected to be 15% lower than in 2010.
The reports from the remaining top five ports were equally gloomy: "In New York-New Jersey, the number of incoming containers in August was about flat with last year. In Savannah, Ga., imports in August fell by 4 percent. Oakland reported that August imports were down 0.9 percent from a year earlier. And Los Angeles, the nation's highest-volume container port, counted 5.75 percent fewer containers in August than a year earlier."
This could partially be the result of an overly cautious approach to inventory levels-retailers have increasing concerns of being left with overstock-however the scale of the decrease is questionable given expectations of higher sales.
"We talk to the railroads, we talk to our ocean carriers, and they're not seeing this big peak, or bracing themselves for a big late peak," said Mr. Steinke, executive director of the Port of Long Beach in California, to New York Times.
Simply put, shipments do not seem high enough to signal strong holiday sales. So which consumer stocks are most vulnerable to a slowdown in holiday demand?
To help you find ideas, we collected data on about 180 consumer stocks. Below we've listed the names that have seen significant institutional selling. In addition, all of these companies have seen a sharp increase in shares shorted over the last month.
Sophisticated investors like short-sellers and hedge funds think these consumer stocks are in deep trouble -- do you agree? (Click here to access free, interactive tools to analyze these ideas.)
List compiled by Eben Esterhuizen, CFA:
1. Warnaco Group
3. Darden Restaurants
4. Cracker Barrel Old Country Store
5. Companhia Brasileira de Distribuicao
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Eben Esterhuizen and Rebecca Lipman do not own any of the shares mentioned above. Short data sourced from Yahoo! Finance. Institutional data sourced from Fidelity.
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