DSW (NYSE:DSW) reports comparable sales rose 0.6% in Q2 to mark its first positive comp since 2015.
Gross profit increased 50 bps as a percentage of sales as a lower level of markdowns factored in. Operating expenses as a percentage of sales improved by 10 bps. Store occupanyc expenses were 20.6% of sales vs. 20.2% a year ago.
"The current retail consolidation provides significant opportunity to acquire market share, and in the next 12 months, we will unveil several exciting new initiatives that will inspire emotional loyalty with the DSW brand," says CEO Roger Rawlins.
DSW sees FY18 EPS of $1.45 to $1.55 vs. $1.44 consensus.
Key events are scheduled for the companies listed below next week.
Notable earnings reports: A tech-heavy list includes 58.com (NYSE:WUBA) on Aug. 21; Toll Brothers (NYSE:TOL) on Aug. 22; DSW (NYSE:DSW) on Aug. 22; JA Solar (NASDAQ:JASO) on Aug. 22; Cree (NASDAQ:CREE) on Aug. 22; Salesforce.com (NYSE:CRM) on Aug. 22; Medtronic (NYSE:MDT) on Aug. 22; HP (NYSE:HPQ) on Aug. 23; Eaton Vance (NYSE:EV) on Aug. 23; American Eagle Outfitters (NYSE:AEO) on Aug. 23; Williams-Sonoma (NYSE:WSM) on Aug. 23; Lannett (NYSEMKT:LCI) on Aug. 23; Veeva Systems (NYSE:VEEV) on Aug. 24; Broadcom (NASDAQ:AVGO) on Aug. 24; Marvell Technology (NASDAQ:MRVL) on Aug. 24; VMware (NYSE:VMW) on Aug. 24; GameStop (NYSE:GME) on Aug. 24; Staples (NASDAQ:SPLS) on Aug. 24.
IPO quiet period expirations: Co-Diagnostics (Pending:CODX) on Aug. 21; Redfin (Pending:RDFN) analyst quiet period expires Aug. 22; Akcea Therapeutics (NASDAQ:AKCA) on Aug. 23.
Secondary offering lockup expirations: Clovis Oncology (NASDAQ:CLVS) on Aug. 21; GlycoMimetics (NASDAQ:GLYC) on Aug. 22; Camping World (NYSE:CWH) on Aug. 23; Costamare (NYSE:CMRE) on Aug. 23.
Notable annual meetings: Quality Systems (NASDAQ:QSII) on Aug. 22; Microchip Technology (NASDAQ:MCHP) on Aug. 22; Bob Evans Farms (NASDAQ:BOBE) on Aug. 23; Gladstone Investment (NASDAQ:GAIN) on Aug. 24; Organovo (NYSEMKT:ONVO) on Aug. 24.
Special shareholder meetings: Whole Foods (NASDAQ:WFM) holds a shareholder vote on its acquisition by Amazon.com (NASDAQ:AMZN) Aug. 23 at 9:30 a.m. ET.
Business update call: Fidelity & Guaranty Life (NYSE:FGL) holds its Q3 bondholder call on Aug. 21.
Notable conferences: Heikkinen Energy Conference in Houston Aug. 23 features Southwestern Energy (NYSE:SWN) and EnLink Midstream (NYSE:ENLC). CFA Intellisight Conference in Minneapolis Aug. 22-23 features Marcus (NYSE:MCS) and CorEnergy Infrastructure Trust (NYSE:CORR).
FDA watch: Alnylam (NASDAQ:ALNY) holds an update call on RNAi Therapeutics on Aug. 23. Adamas Pharmaceuticals (NASDAQ:ADMS) has its Pdufa date for ADS-5102 to treat levodopa-induced dyskinesia in patients with Parkinson’s disease on Aug. 24.
OPEC watch: The OPEC/non-OPEC Joint Technical Committee meets in Vienna to assess compliance with production cuts on Aug. 21.
Barron's mentions: The cover explores why Starbucks (NASDAQ:SBUX) could jump 20%, with some help from digital payments. Lockheed Martin (NYSE:LMT) should benefit from an expected boost in military outlays. Gardner Denver (NYSE:GDI) could see 40% upside after a retooling under KKR. Motorola Solutions (NYSE:MSI) faces challenges as a big new public-safety network might supplant the company's two-way radios. And dividend investors should look beyond pharmaceutical stocks to the healthy yields in the rest of healthcare.
Quo Vadis Capital founder John Zolidis isn't blaming Amazon for the weak guidance issued by Dick's Sporting Goods (NYSE:DKS) and the resulting 23% slide in share price.
"The largest issue, in our opinion, is the end of the fashion athletic trend or 'ath-leisure' as it has been called. This trend, driven by Under Armour (NYSE:UAA) and Nike (NYSE:NKE) as well as Lululemon (NASDAQ:LULU) has been the most important contributor to DKS' same-store sales growth over the last several years, by our estimates. This trend is now officially over, in our opinion."
Zolidis says the death of athleisure has been confirmed in Nike futures orders growth, Under Armour results, Big Five (NASDAQ:BGFV) sales numbers and Hibbett Sports (NASDAQ:HIBB) earnings. "Our advice to investors is to continue to avoid the space," concludes Zolidis.
A stronger-than-anticipated July retail sales report is taking a back seat to key earnings reports in the retail sector. A promise from Dick's that it will ratchet up promotions to take market share and weak guidance from Coach are the two events weighing the most on apparel/shoe/sporting equipment sellers.
Early decliners include Vista Outdoor (VSTO -1.5%), American Outdoor Brands (AOBC -1.7%), Foot Locker (FL -4.7%), Finish Line (FINL -3.9%), DSW (DSW -6.2%), Genesco (GCO -2.8%), Boot Barn (BOOT -1.6%), Gap (GPS -2.5%), Finish Line (FINL -3.9%), Urban Outfitters (URBN -4.5%), Express (EXPR -6.4%), Abercrombie & Fitch (ANF -4.8%), Vera Bradley (VRA -4.5%), Movado (MOV -1.2%), Ascena Retail (ASNA -5.9%), L Brands (LB -2.2%) and J. Jill (JILL -1.7%).
Wedbush upgrades DSW (NYSE:DSW) to an Outperform rating after having the retailer lined up at Neutral.
"We argue that for the first time in a while, DSW is properly allocating inventory dollars that would allow it to hit or potentially exceed its comp outlook on the year. Our checks indicate solid performance in dress sandals, athletic and fashion athletic and on plan performance in weaker categories (dress)," writes analyst Chris Svezia.
The firm's price target of $22 reps 25% upside from last night's closing price. DSW +1.36% premarket to $17.90.
Weak sales guidance from Hibbett Sports (HIBB -26.6%) is rattling around the sensitive sporting goods sector.
Dick's is down 3.39%, while Sportsman's Warehouse (SPWH -5.6%), Foot Locker (FL -2.9%), Finish Line (FINL -3.6%), DSW (DSW -1.6%), Caleres (CAL -1.2%), Boot Barn (BOOT -3.9%), Deckers Outdoor (DECK -2.7%) and Wolverine World Wide (WWW -1.7%) are some of the other sports-related retail chains under pressure.