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Carter's (CRI) Stock Dips 23% in 3 Months: What You Should Know
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Carter's (CRI - Free Report) has experienced a 23.0% decline in its share value over the past three months, underperforming the industry’s decline of 11.9%. Additionally, the stock is trading near its 52-week low of $60.57.
Image Source: Zacks Investment Research
What Has Hurt the Stock?
Carters has been contending with softness in the top line, which declined 4.9% during the first quarter of 2024, following a decline of 5.9% in the preceding quarter. The company cited inflation, higher interest rates, increased consumer debt levels, and recession risks as the main reasons for the sales decline, which affected demand from both consumers and wholesale customers.
With ongoing inflation, consumers have become more careful about their spending budgets and adjusted their shopping needs accordingly. Families with young children continue to struggle with the higher cost of living. Sales in the U.S. Retail segment fell 5%, with U.S. Retail comparable sales declining 6.8%.
The company noted that U.S. retail segment sales have been impacted by the shift of some sales to March due to the early Easter holiday and the continuation of cooler weather in April, which dampened demand for warmer weather apparel. Management anticipates that the sales turmoil will persist in the upcoming quarter, as evidenced by recent sales trends across its businesses. Comparable retail sales for the combined months of March and April through Apr 26 were down nearly 11%. Consequently, the company predicted soft overall sales trends for the second quarter of 2024.
This Zacks Rank #4 (Sell) company observed soft online sales trends due to a recent shift in consumer behavior. The company pointed out that consumers are now making more deliberate store visits for immediate needs, in contrast to the more impulsive nature of e-commerce purchases. As a result, Carter's experienced a 13% year-over-year decline in e-commerce sales in the U.S. Retail segment in the first quarter of 2024, primarily due to reduced online traffic. For 2024, the company anticipates e-commerce sales to decline by mid-single digits for the U.S. Retail segment.
Is There Still Something to Know?
Carter’s pricing strategy, inventory management efforts, and product offerings should provide some cushion. Also, favorable ocean freight rates, lower inventory levels and decreased distribution costs should contribute to margins.
The company’s Everyday Value program, launched in February 2024, is making decent progress. This initiative helps parents manage their budgets effectively amid inflationary pressures by offering competitive and consistent prices on essential stock-up items.
3 Picks You Can’t Miss Out on
We have highlighted three better-ranked stocks in the broader sector, namely, Hanesbrands (HBI - Free Report) , Crocs, Inc. (CROX - Free Report) and Guess (GES - Free Report) .
Hanesbrands engages in designing, manufacturing, sourcing and selling of apparel essentials for men, women and children in the United States and internationally. It currently flaunts a Zacks Rank #1 (Strong Buy). It has a trailing four-quarter earnings surprise of 10.2%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Hanesbrands’ current financial-year earnings suggests a 666.7% surge from the year-earlier levels.
Crocs develops and manufactures lifestyle footwear and accessories. It currently has a Zacks Rank #2 (Buy). It has a trailing four-quarter earnings surprise of 17.1%, on average.
The Zacks Consensus Estimate for Crocs’ current financial-year sales and earnings implies an improvement of 4.3% and 5.6%, respectively, from the prior-year actuals.
Guess designs, markets, distributes and licenses casual apparel and accessories for men, women and children, per the American lifestyle and European fashion sensibilities. GES carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Guess’ current financial-year sales suggests growth of 11.7% from the year-ago reported figures. GES has a trailing four-quarter earnings surprise of 31%, on average.
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Carter's (CRI) Stock Dips 23% in 3 Months: What You Should Know
Carter's (CRI - Free Report) has experienced a 23.0% decline in its share value over the past three months, underperforming the industry’s decline of 11.9%. Additionally, the stock is trading near its 52-week low of $60.57.
Image Source: Zacks Investment Research
What Has Hurt the Stock?
Carters has been contending with softness in the top line, which declined 4.9% during the first quarter of 2024, following a decline of 5.9% in the preceding quarter. The company cited inflation, higher interest rates, increased consumer debt levels, and recession risks as the main reasons for the sales decline, which affected demand from both consumers and wholesale customers.
With ongoing inflation, consumers have become more careful about their spending budgets and adjusted their shopping needs accordingly. Families with young children continue to struggle with the higher cost of living. Sales in the U.S. Retail segment fell 5%, with U.S. Retail comparable sales declining 6.8%.
The company noted that U.S. retail segment sales have been impacted by the shift of some sales to March due to the early Easter holiday and the continuation of cooler weather in April, which dampened demand for warmer weather apparel. Management anticipates that the sales turmoil will persist in the upcoming quarter, as evidenced by recent sales trends across its businesses. Comparable retail sales for the combined months of March and April through Apr 26 were down nearly 11%. Consequently, the company predicted soft overall sales trends for the second quarter of 2024.
This Zacks Rank #4 (Sell) company observed soft online sales trends due to a recent shift in consumer behavior. The company pointed out that consumers are now making more deliberate store visits for immediate needs, in contrast to the more impulsive nature of e-commerce purchases. As a result, Carter's experienced a 13% year-over-year decline in e-commerce sales in the U.S. Retail segment in the first quarter of 2024, primarily due to reduced online traffic. For 2024, the company anticipates e-commerce sales to decline by mid-single digits for the U.S. Retail segment.
Is There Still Something to Know?
Carter’s pricing strategy, inventory management efforts, and product offerings should provide some cushion. Also, favorable ocean freight rates, lower inventory levels and decreased distribution costs should contribute to margins.
The company’s Everyday Value program, launched in February 2024, is making decent progress. This initiative helps parents manage their budgets effectively amid inflationary pressures by offering competitive and consistent prices on essential stock-up items.
3 Picks You Can’t Miss Out on
We have highlighted three better-ranked stocks in the broader sector, namely, Hanesbrands (HBI - Free Report) , Crocs, Inc. (CROX - Free Report) and Guess (GES - Free Report) .
Hanesbrands engages in designing, manufacturing, sourcing and selling of apparel essentials for men, women and children in the United States and internationally. It currently flaunts a Zacks Rank #1 (Strong Buy). It has a trailing four-quarter earnings surprise of 10.2%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Hanesbrands’ current financial-year earnings suggests a 666.7% surge from the year-earlier levels.
Crocs develops and manufactures lifestyle footwear and accessories. It currently has a Zacks Rank #2 (Buy). It has a trailing four-quarter earnings surprise of 17.1%, on average.
The Zacks Consensus Estimate for Crocs’ current financial-year sales and earnings implies an improvement of 4.3% and 5.6%, respectively, from the prior-year actuals.
Guess designs, markets, distributes and licenses casual apparel and accessories for men, women and children, per the American lifestyle and European fashion sensibilities. GES carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Guess’ current financial-year sales suggests growth of 11.7% from the year-ago reported figures. GES has a trailing four-quarter earnings surprise of 31%, on average.