If you thought Walmart and Target had disappointing earnings, these retailers did so much worse - Grizler

Rising costs and inflation hurt retail companies. As a result, analysts lower their stock price.

Store stocks are very good this week as Bellwether companies have disappointed investors with declining profits.

And now, retailer reviews shed light on companies that put in worse numbers than those reported by Target Corp. TGT and Walmart Inc. WMT, both of which shook the industry and darkened the sentiment of investors two days ago.

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So the list of sellers who reported a drop in comparable store sales is below.

Growing inventories

One might expect companies that increase sales of the same store during high inflation to book higher profits, but that is not the case for the two bigots:

Target shares fell 25% on May 18 after a trader reported a 48% decrease in revenue per share in its first quarter of financing ending April 30 from the previous quarter, despite a 3.4% increase in similar retail sales. The company cited rising costs, including wages, transportation and storage. That last thing stood out: Product inflation since April 30 increased by 43% compared to the previous year. Target CEO Brian Cornell said consumer spending has shifted to “solid objects,” including furniture, appliances and appliances.

Following a May 17 revenue quarterly report on April 30, Walmart's stock dropped 17% in two trading periods. The company's quarterly profits have dropped by 24% over last year. The company's biggest increase in costs was higher wages, but commodity prices rose by 32% compared to last year. Walmart also said customers switch to less expensive items with a private label.

It takes time for such big companies to make changes, but at least they have always made a profit. But Target and Walmart's continued profitability was to keep the S&P 500 consumer choice sector down by 6.6% on May 18.

Possible overreaction?

Following inflation and lower analysts' interest rates over the next 12 months, Target shares are currently trading at a forward 13.13 inflation target. That compares with Walmart's 18.5 P / E rating and 16.7 P&E S&P 500 Index SPX.

In a letter to clients on May 18, Jefferies analyst Stephanie Wissink pointed out that Target's success during the coronavirus violence led to a difficult comparison as the economy expanded. But he also wrote that this period could be a "complete storm" for the company, "an increase in the cost of transporting goods for the business that needs the goods," the end of consumer rehabilitation and "directed orientation in the mixing phase." . ” He maintained his neutrality rate in Target stocks, but lowered the target share price to $ 168 from $ 252.

Taking a very good tone, Ally Financial Chief Markets and Money Strategist Lindsey Bell wrote in an email that Target results showed a "strong customer," while ensuring a change in spending on "experience-based" items, such as luggage and toys.

Bell noted that Target has maintained its marketing focus during "trading" as consumers look to reduce spending on necessities to spend on "services and information."

His comments following the Target report were built on similar remarks after Walmart and Home Depot Inc. HD have expanded their marketing guide. However, Bell also notes that “investors are likely to remain concerned about how long this consumer crisis [in this period of inflation] will last.”

The ‘worst’ of retail

The next stock screen starts with the S&P Composite 1500 Index XX: SP1500, built with S&P 500, S&P 400 Mid Cap Index MID and S&P Small Cap 600 Index SML.

The same store or similar sale is reported by retailers, but also restaurant operators and a few other industries, such as car dealers. So the first cut reduced the list to 110 companies.

Financial calendars are very different, so it is not true to say that any income period is over. The following list starts with Target and Walmart, but then includes 15 companies that reported a decline in sales of the same store from the previous year, with their financial statements reported as late as May 18th.

Company	Ticker	Same-store sales growth	Estimated same-store sales growth – Q1	Estimated same-store sales growth – Q2	Estimated same-store sales growth – Q3	Estimated same-store sales growth – Q4
Target Corporation	TGT	3.3%	3.5%	3.0%	4.2%	3.0%
Walmart Inc.	WMT	3.0%	4.6%	2.6%	3.7%	3.2%
Bed Bath & Beyond Inc.	BBBY	-12.0%	-18.0%	-7.9%	-1.0%	2.0%
Sleep Number Corp.	SNBR	-11.0%	2.5%	4.7%	15.0%	9.0%
Shoe Carnival Inc.	SCVL	-10.6%	-1.1%	2.2%	4.0%	3.0%
Ollie’s Bargain Outlet Holdings Inc.	OLLI	-10.5%	-14.8%	0.0%	5.5%	6.0%
CarMax Inc.	KMX	-6.5%	-11.5%	0.1%	-3.4%	8.1%
Lowe’s Cos. Inc.	LOW	-4.0%	2.5%	1.5%	1.0%	3.3%
Domino’s Pizza Inc.	DPZ	-3.6%	-4.4%	0.5%	2.8%	4.3%
LL Flooring Holdings Inc.	LL	-3.6%	-2.0%	4.0%	5.0%	4.0%
Bath & Body Works Inc.	BBWI	-3.5%	0.1%	0.5%	1.1%	7.0%
Big Lots Inc.	BIG	-2.3%	-11.2%	-0.3%	1.5%	3.6%
Best Buy Co. Inc.	BBY	-2.3%	-8.6%	-4.7%	-1.1%	2.8%
Dollar General Corp.	DG	-1.4%	-1.2%	2.6%	3.9%	4.2%
Rent-A-Center Inc.	RCII	-1.1%	-2.7%	-1.7%	-1.3%	2.0%
Hibbett Inc.	HIBB	-1.0%	-19.8%	-5.9%	3.7%	7.8%
Carter’s Inc.	CRI	-0.5%	3.5%	0.0%	0.7%	N/A