In the past I’ve talked a lot about the death of the American mall. There are a variety of factors contributing to its demise. The most obvious is the rise of online shopping. Online you can get exactly what you want shipped to your home, ordering from the comfort of your couch. The mall, once a centerpiece of the community, is slowly but surely losing its appeal. Retailers have struggled to find that balance between those traditional brick and mortar outlets and an online presence. One such retailer that has been having a tough time adjusting is today’s Bear of the Day, Buckle (BKE).
The Buckle, Inc. operates as a retailer of casual apparel, footwear, and accessories for young men and women in the United States. The company markets a selection of brand name casual apparel, including denims, other casual bottoms, tops, sportswear, outerwear, accessories, and footwear. It operates stores under the Buckle and The Buckle names. The company also sells its products through its Website, buckle.com. As of August 19, 2016, it operated 470 retail stores in 44 states.
The stock is a Zacks Rank #5 (Strong Sell) right now. Mostly because three analysts have dropped their earnings estimates for the current quarter, next quarter, current year and next year. The bearish sentiment not only shows lowered estimates but also no growth year over year. Looking at the current year numbers, the consensus has dropped from $2.49 to $2.23. Next year’s number has gone from $2.43 to $2.20.
It should therefore come as no surprise that shares have come under pressure recently. In fact, shares have struggled to break a bearish trend since topping out over $35 last April. Since then, it’s been a stairway to the basement, with BKE dipping to $20 before yesterday’s broad-based rally that boosted most of the market. There is one silver lining here, the Commodity Channel Index has popped up through the zero line, giving a “Buy” signal after being oversold below -100 for the last couple of weeks.
Investors looking for other stocks in the same industry should check out Zacks Rank #1 (Strong Buy) Tillys (TLYS) or Zacks Rank #2 (Buy) Foot Locker (FL).
More Stocks to Sell. Now.
Beyond our Bear Stock of the Day, today's list of 220 Zacks Rank #5 Strong Sells demand even more urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. Many appear to be sound investments but, since 1988, such stocks have actually performed more than 11X worse than the S&P 500.
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