Clothing Retailers are Cleaning Out Inventory in Advance of the Holiday Season

Janus Capital Markets released a research note today highlighting its concerns about clothing retailers.  Following are some highlights from its report.

  • Gap (NYSE:GPS): The company is clearing out its inventory in advance of the holiday season, marking down clothes by 50% in some cases. The Gap, Inc. is an international specialty retailer operating retail and outlet stores.  About the company: The Company sells casual apparel, accessories and personal care products for men, women, and children.  The Gap operates stores in the United States, Canada, the United Kingdom, France, Ireland and Japan.
  • Talbots (NYSE:TLB): The company is also clearing out its inventory, with discounts of up to 30%.  About the company:   The Talbots, Inc. is an international specialty retailer and direct marketer of women’s apparel, accessories, and shoes.  The Company operates stores in the United States and Canada.  Talbots also retails products over the Internet and through its catalog.
  • Abercrombie & Fitch (NYSE:ANF): The company’s inventory levels are rather low in advance of the holiday season, suggesting that October sales at stores open for more than a year will be low as compared to prior years.  The analysts also speculate that Abercrombie & Fitch has been successful in taking market share from Aerpostale (NYSE:ARO) and American Eagle Outfitters (NYSE:AEO).
  • Chico’s (NYSE:CHS): This company has also resorted to discounts to clear out inventory.  They are offering discounts of 20%. About the company: Chico’s FAS, Inc. sells private label women’s casual clothing and related accessories.  The Company’s clothing includes tops, pants, shorts, skirts, and dresses.  Chico’s owns and operates stores throughout the United States.
  • Hot Topic (NASDAQ:HOTT): This company has instituted a promotion in which all t-shirts and denim is half off, if you buy one item at full price. Hot Topic, Inc. operates stores selling music-licensed and music influenced apparel, accessories, and gift items for young men and women principally between the ages of 12 and 22.  The Company operates under the brand names HOT TOPIC and TORRID.
  • New York & Company (NYSE:NWY): Inventory levels are very light, suggesting that revenues will come in at the low end of expectations. New York & Company, Inc. is a specialty retailer of women’s apparel products.  The Company designs and sources its branded New York & Company merchandise sold exclusively through its network of retail stores nationwide.

(Note: Selected financial data are sourced from Google Finance.  All data are assumed to be accurate.)

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