Stein Mart Inc. (SMRT) reported total sales of $102.1 million in November 2011, down 5.1% from $107.6 million in November 2010. The company’s comparable store sales (comps) for the month also declined 4.6% versus flat growth recorded in the year-earlier period.
During the month, the company anniversaried its largest event which led to a shortfall in comps. Additionally, the company also reduced the dependence on coupons that in turn hurt its sales.
In November, the categories that performed well were ladies' accessories and men's furnishings. Ladies' dresses and career sportswear as well as home decor were the poor performers in the month. Geographically, November sales were stronger in California and Texas while sales were weaker in the Carolinas and the Midwest.
Stein Mart’s year-to-date total revenue was down 1.9% year over year at $934.3 million while same-store sales dropped 1.2% as opposed to 1.8% the same-period last year. In the third quarter, the company’s total sales decreased 3.5% year over year to $258.5 million due to a 2.9% reduction in comps.
The company, which offers fashion merchandise and service, ended November with 263 stores compared with 265 stores in the year-ago period. During the month, the company opened a new store in Denver, Colorado. Unit economics for the full year include three new stores, four relocations and five closings.
The Zacks Consensus earnings estimates for the fourth quarter and fiscal 2011 are pegged at 22 cents and 53 cents, respectively, representing year-over-year declines of 32.03% and 38.08%. Over the last 7 days, none of the analysts went for any movement in their estimates. We remain pessimistic on the comparable store performance of Stein Mart as the company has been trailing for quite sometime.
Stein Mart, an off-price retailer of apparel for women and men, accessories, gifts, footwear and home decor, currently retains a Zacks #4 Rank, which translates into a short-term Sell rating. However, we are maintaining our long-term Neutral recommendation on the stock. One of its competitors, Cache Inc. (CACH) currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.
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