We’re nearing the end of this quarterly corporate earnings season, but there are still some key reports to look out for, especially from some of the biggest U.S. retailers.
Bellwether retailers set to report fiscal first-quarter earnings this week include Macy’s, J.C. Penney’s, Kohl’s, Nordstrom and Wal-Mart.
The results are unlikely to be pretty, at least according to Wall Street projections. Thanks to the colder-than-usual weather in much of the U.S. in the last three months, shoppers were kept away from the malls, forcing retailers to cut prices drastically to move inventory.
Mall icon J.C. Penney’s, for example, is expected to extend its streak of quarterly losses. The former retail powerhouse fired CEO Ron Johnson in April after his strategy of ditching discount coupons for everyday low prices proved to be a colossal failure, but is still struggling to turn things around. Despite the gloomy forecasts for retail companies reporting financial results this week, it’s been a good earnings season thus far for U.S.-listed public companies.
Some 89% of S&P 500 companies have posted earnings, and among those, 66.7% beat profit expectations, which is comfortably higher than the 63% since 1994.
However, a mere 46.4% posted higher-than-expected revenue figures, compared to the average of 62% since 2002.
This week, we will also receive some housing data, including April’s housing starts, which are expected to ease slightly from March numbers.
The housing sector has been one of the bright lights in an overall sluggish economic recovery, and economists expect this sector to continue to show strength through 2013.