Second-quarter profits for the retailers have been coming in better than expected, mirroring a trend I've seen with other industries. Nearly 75% of the retailers have topped expectations.*
Though the numbers are better than forecast, they need to be taken in context with the economic backdrop. Most retailers failed to achieve growth, either in terms of same-store sales or profits. The third-quarter could remain challenging, given the consumer confidence numbers. The Conference Board's index of consumer confidence stands at just 54.1. Though an improvement from July, it is still a weak reading.
Some Retailers Delivering Real Growth
Not all retailers are struggling, however. In fact, just last week, 2 retailers reported both sales and earnings growth.
Aeropostale (ARO)
achieved an impressive 12% increase in same-store sales, which helped lead to a 20% increase in total sales. Earnings of 57 cents per share were a penny above expectations, and compare
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