Raw Data Report: Santa Fe Cattle Co., Kohl's, Abercrombie & Fitch, Under Armour

Each day, Wall Street is flooded with stock research offering a multitude of conflicting investment opinions. As such, TickerMine is not in the business of providing more opinions. We believe that accurate raw data points can be used to gain insight in to the stock selection and valuation process.

Warming Up on Sante Fe Cattle Co. (SFHD)

We have completed our first small survey of a growing restaurant concept called Santa Fe Cattle Co. The casual burgers, steaks and ribs restaurant has roughly 30 locations across the midwest and south. We found that average wait times at a Santa Fe Cattle Co. location (as measured across lunch and dinner times) was approximately 15 minutes. The longest wait for a table of 4 (the question we asked) was one hour during the dinner hours at the Shelbyville, Indiana location. Over half the locations surveyed reported no wait times, while the remaining locations reported long wait times between 30 and 60 minutes. In addition to Shelbyville we found the Bowling Green, KY location to be quite busy as well. We found that over 50% of respondents reported that steaks were the most popular item while 15% cited burgers and the remainder ranged from quesadillas to salmon. This first survey creates a benchmark in our research as we grow our comprehensive restaurant coverage.

Half of Kohl's (KSS) Stores Report Having Excess Inventory

TickerMine profiled Kohl's Corporation this week in advance of the company reporting earnings for the holiday season. Our researchers consulted 34 stores around the country and asked several questions regarding the stores' performance. We found that 65% reported business was either very strong or above average this year compared with a year ago and 30% indicated it was about average with last year. While 50% reported having excess inventory that was going on sale soon, the same amount reported having no excess inventory.

Over 44% indicated that the weak housing market and economy have hurt the store's business but another 38% indicated that the economy will not impact sales very much. Simply Vera, the line by A-list designer Vera Wang, is the bestselling woman's clothing brand according to 18% of those interviewed and another 12% indicated Chaps was a hot item. The Daisy Fuentes and Elle brands were cited by 9% of stores as very popular women's items.

Abercrombie (ANF) Stores Appear to Be Fully Stocked, Less Busy Than Last Year

We recently conducted a survey of Abercrombie & Fitch stores across the U.S. This survey was not commissioned or authorized by the company (a note we are adding since some people are confused by the concept of "independent" information gathering.). We found that 55% of stores reported they were "less busy" than a year ago. 24% reported having "the same" level of business while 18% reported being "busier", and 3% of respondents did not know how business compared to the previous year. 97% of respondents reported having enough stock of product in their stores. 76% reported that it would not be a problem to keep the top selling items in stock during this winter season. The top selling items were reported to be sweaters (Victoria) according to 18% of respondents, Fleece according to 9%, Collette Jeans (9%) and outerwear (Terri Jackets) 9%. Every store we surveyed had been open more than one year.

Dick's (DKS) Stores See Under Armour (UA) Slowdown Driven By Economy, Not Competition

We recently conducted a survey of Dick's Sporting Goods stores to get a sense for sales activity on Under Armour products post-holiday season. While the companies have already reported negative outlooks for 4Q, we wanted to investigate causes of UA's slowdown (competition, prices, overall economy). We found that most respondents, 58%, believed that the overall economy had slowed sales of UA's products. 37% believed that UA's prices contributed to slower sales while 5% were unsure about the cause. 47% of respondents did say that demand for UA products were slowing and that UA products were being discounted. 21% respondents said that there was no discounting or sales on UA gear, while 32% of all respondents said that UA was being discounted as part of normal store wide clearance sales.

Comments

[Doug Garnett:]

Full Truth About the Economy is Too Complex for Headlines
An Alternative View of the Financial “Catastrophe”
By Doug Garnett, Atomic Direct


In case you haven’t heard, we’re in a recession. And, news outlets couldn’t be happier.
Finally, financial reporters have captured the top of the hour (no longer appearing only briefly at a quarter past); all from a crisis with no apparent end and no absolute solution.
But will their gleeful doom and gloom drive us from recession into depression?
Lions & Tigers & Bears
The difference between tone and fact in a 12/29/08 Bloomberg article started my personal campaign against media hype.
Titled “Holiday Sales Drop to Force Bankruptcies, Store Closings,” this article reported that 148,000 stores may close in 2008. That sounds bad.
Until you read further and find out that this is only the worst since 2001. In truth, well over 100,000 stores normally close in a year and 153,000 stores closed in 2001. So in 2008 perhaps 10,000 unexpected mom and pop store closings were spread across 200 DMAs (that’s the smallish average of 50 per DMA.)
The article also notes the S&P Retail Index Stock is down by 35%. This says nothing about the economy. Besides, the Dow Jones dropped 32%.
November Spending Was Actually Up
Note also the poorly chosen title for a 12/24/08 AP article “November Personal Spending Falls 0.6 Percent.” Deep in the article that you find that the drop is due solely to gas prices and that “(e)xcluding price changes, consumer spending would have … actually risen by 0.6% in November.”
So in November consumer demand was up and consumers paid fair prices for the goods.
December Was Bad, but Not Too Bad
On January 8th retailers released their numbers and the AP article is titled “Retailers Report Dismal Sales.” Buried in the article we learn that Target, Macy’s, and even JCPenney beat expectations and that sales increased at both Wal-mart and Costco.
Competing to Dramatize the Crisis
Driven by viewership, ego and money, the media profits from cataclysm. Networks and newspapers need it to increase viewership and readership and so-called “expert sources” need the screen time on 24-hour networks to build their consulting businesses.
And, cataclysms offer reporters career-making opportunities. What reporter wouldn’t kill for the opportunity to say: “Well Bob, the fourth horseman of the apocalypse arrived this morning. Retail analysts are telling us to stockpile water and prepare for Armageddon. We’re expecting a statement from Saint Peter at any moment. Back to you.”
Left Unreported: Truth
Truth is found in the complexities of competing facts. Unfortunately, it appears simplification to the point of stupidity attracts news viewers.
What we haven’t heard includes:
• Amazon.com had record sales in fourth quarter.
• Malls were packed with shoppers spending money.
• A growing number of analysts offer optimistic assessments of 2009.
My own client’s fortunes are pretty good. One luxury product saw sales drop due to soft consumer spending. A couple more lost sales for reasons I believe are unconnected to the economic downdraft. One client mounted a major Q4 effort and saw astounding retail sell-through. And the rest were a mix of slightly down, static or up slightly. That’s not a bad year.
What Should Have Been
The real truth of this year’s holiday shopping season is that sales would have been much better without the media hype (made worse by two months of presidential campaigning.) That hype helped turn a serious crisis in the financial industry into a broader crisis that affected retail.
News reports destroyed consumer confidence. Media hype caused retailers to curtail orders from manufacturers. And manufacturers have undertaken pre-emptive layoffs that don’t appear required by their business realities.
Recession or Depression?
Media mis-reporting may change what might have been a recession into a deeper depression. We can’t do much about that.
But knowing that the depth of this crisis may be media-induced should change our actions and we should never read or hear a headline without digging deeper to find the truth. After all, it’s our customers, clients, employees and families who suffer if they are wrong.





About the author:
Doug Garnett is president of Atomic Direct — a boutique DRTV agency specializing in consumer and retail products. Atomic’s clients include Rubbermaid, DuPont, AAA, Alberto-Culver, and DisneyMobile.. Doug also teaches advertising in the School of Business Administration at Portland State University.

Jan 23 12:36 PM