Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:
New Clothing Lines and Rising Profits at Penney and Kohl’s [New York Times]
Summary: J.C Penney and Kohl's both posted strong third quarters yesterday. JCP's net income rose 23% to $287 million, or $1.26/share, beating analyst estimates of $1.23/share. Kohl's profits soared 45 percent, to $224.5 million, or 68 cents/share, beating analyst estimates of 64 cents/share. Sales at J.C. Penney climbed 6.7%, to $4.78 billion. Sales at Kohl’s rose 17%, to $3.64 billion. The sales increases have been pinned on the new exclusive brands that both stores have introduced for this year's holiday shopping season.
Related links: Earnings conference call transcripts: JCPenney Q3 2006. Press releases: JCPenney Third Quarter Results, JCPenney Comparable Store Sales Increase, Kohl's Corp. Third Quarter Results . Additional Earnings Coverage: Forbes, MarketWatch.com. Commentary: Where is the Retail Carnage? • Retail Beat: Merchandising is Key.
Potentially impacted stocks and ETFs: Kohl's (NYSE:KSS), J.C. Penney (NYSE:JCP) • Competitors: Target (NYSE:TGT), Wal-Mart (NYSE:WMT) • ETFs: PowerShares Dynamic Retail (NYSEARCA:PMR), iShares Russell Midcap Index (NYSEARCA:IWR) both have JCP as a top ten holding. Retail HOLDRS (NYSEARCA:RTH) has KSS as a top ten holding.
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