Rob Zenilman submits: In today's Wall Street Journal, Justin Lahart & Amy Merrick's Consumers Curb Upscale Buying As Gasoline Prices, Housing Bite discusses how $3 a gallon gasoline and a weak housing market is causing more headaches for retailers & restaurants - only now it's hitting the middle class. Examples include:
- Boat builder Brunswick (NYSE:BC) and upscale sandwich shop (NASDAQ:PNRA) have both seen their stocks hit after reporting disappointing sales.
- P.F. Chang's China Bistro (NASDAQ:PFCB), Applebee's (APPB) and The Cheesecake Factory have all issued sales warnings.
- Williams-Sonoma's (NYSE:WSM) Pottery Barn recently lowered its Q2 revenue forecast from $842mm-$856mm to $823mm-$837mm.
Comment: Until now concerns were limited to the lower end retailers, such as Wal-Mart (NYSE:WMT) and Target (NYSE:TGT). July's retail sales figures showed that the stronger gains were at the higher-end stores, at the expense of the lower end. Sustained high priced gas and a slow housing market will accelarate the trend, with only the high end remaining immune to its effects.