Scalper1 News
E-commerce leader Amazon.com ( AMZN ) will become the No. 1 U.S. apparel retailer next year, investment bank Cowen predicted Wednesday. Cowen analyst John Blackledge said recent earnings reports by Amazon and Macy’s ( M ) painted a clear picture. “In light of Amazon and Macy’s recent results, we feel more confident that Amazon will displace Macy’s as the No. 1 U.S. apparel retailer by 2017,” Blackledge said in a research report. “Amazon’s Apparel & Accessories business is one of the key drivers of Amazon’s EGM (electronics and general merchandise) segment.” Amazon’s success in the apparel category is being driven by a dramatically larger selection, ramping brand relationships, superior fulfillment and technology innovations. Amazon is growing in the clothing business, while traditional retailers such as Wal-Mart ( WMT ) and Target ( TGT ) are in decline, Blackledge said. In the first quarter, the number of Amazon apparel purchasers increased 19% year over year, while apparel buyers at Wal-Mart and Target fell 1% and 5%, respectively, he said. “The longer-term trend also reflects a share shift in apparel purchasers, with Amazon apparel purchaser growth of 28% each quarter (on average) since 2014, while apparel purchasers fell 4% and 3% at Wal-Mart and Target,” he said. “In Q1, Amazon had 15% more apparel purchasers than Wal-Mart (vs. 24% fewer in Q1 2014) and 37% more apparel purchasers than Target (vs. 4% more in Q1 2014).” Macy’s on Tuesday reported soft Q1 sales and slashed its full-year forecast, sending its stock diving to a four-year low Wednesday. The Cleveland-based company said its first-quarter sales fell 7.4% year over year to $5.77 billion. Analysts on average were looking for $5.93 billion in sales. For 2016, Macy’s now expects same-store sales to fall 3% to 4%, compared with its prior guidance for a 1% decline. Macy’s stock was down 14%, below 32, in afternoon trading on the stock market today . Amazon stock was up 1.5%, near 716. On April 28, Amazon reported its highest sales growth in nearly four years . Its Q1 revenue jumped 28% to $29.1 billion, ahead of the $28 billion view. Scalper1 News
Scalper1 News