Mall Anchors Macy's, Kohl's, Nordstrom Rated Buy
Today I will profile these stocks and provide updated "buy-and-trade" strategies including for some of the other retailers that reported earnings this week.
First a quick update on Home Depot (HD) which reported results pre-market on Tuesday. HD beat earnings estimates on both the top and bottom line, and the stock set a new multi-year high at $64.44.
Yesterday in Retail Earnings at the Mall I indicated that closes above my monthly pivot at $62.76 indicates upside is to its all-time bubble top of $70.00 set in April 2000. HD did not hold onto those gains and the close on Wednesday was below $62.76 which indicates risk to my quarterly value level at $58.83. In hindsight booking profits between $62.76 and $64.44 was prudent buy-and-trade strategy.
At www.ValuEngine.com we have three retail-oriented sectors. Consumer discretionary is 7.0% undervalued, consumer staples is 10.0% overvalued and retail-wholesale is 2.8% overvalued.
Here are my buy-and-trade profiles for the mall anchors:
Dillards (DDS) ($82.50): Has a buy rating and is 12.0% overvalued. The stock traded up to a multi-year high of $86.71 on Nov. 8 in anticipation of a positive earnings report. The stock had a significant beat on EPS earning 96 cents well above the 75 cents a share estimate, but that was priced in as the stock fell to $82.18 yesterday. My monthly value level is $77.78 with a quarterly risky level at $85.23, which was tested at that pre-earnings high. The weekly chart profile shifts to negative on a weekly close below the five-week modified moving average at $78.44.
JC Penny (JCP) ($16.89): Has a hold rating and traded lower on Nov. 9 on a significant earnings miss with an EPS loss of 93 cents compared with a 6 cents a share loss estimate. My monthly value level is $14.16 with a semiannual pivot at $18.18 and weekly risky level at $19.32. Yesterday's low at $16.89 is a multi-year low. The March 2009 low was $13.71. The weekly chart profile has been negative since the week of Oct. 26.
Nordstrom (JWN) ($54.11): Has a buy rating and traded up to $58.40 on Election Day then reported quarterly results Nov. 8. EPS missed estimates by one cent at 71 cents a share. The stock traded down to $53.96 on Nov. 12 compared with the 200-day simple moving average at $53.74. My semiannual value level is $45.56 with a monthly pivot at $55.12 and my annual risky level at $58.83. The weekly chart shifted to negative last week with a close below the five-week MMA at $55.42.