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[video] Macy's, Kohl's Shares Surge Despite Stagnant Revenue

The video that this transcript is based on appeared on Nov.12.

NEW YORK (TheStreet) -- Macy's and Kohl's have stagnant revenues, while the stock price rides the rally wave. Dish dishes out profits.


Good morning and welcome to wall and broad brought them here from the corner wall street Broad Street in lower Manhattan. Equity look to be pointing lower this morning in early trading and here's today's headlines Treasury yields continued to climb. The bond market was closed yesterday so look like the increases are continuing from last Friday. Homebuilder DR Horton (DHI) reported a 2 percent fall in orders, but the orders that have are at higher prices and Rackspace (RAX) hosting is down over seven percent this morning after reporting it net income fell 40 percent as the cloud computing company deals with higher costs. It's beginning to look a lot like Christmas that the snow is falling outside our studios, but before we get in the holiday shopping of the fall for our good friends over at Macy's (M) and Kohl's (KSS) joining me now is Laurie Kulikowski our retail analyst so Lori it's going to be a big earnings week for retailers.

Yeah at Macy's kicks it off tomorrow we have Walmart (WMT) we have Kohls we have Nordstrom (JWN) on Thursday and then the following week we got a ton of our companies reporting.

Alright when we look at some other earnings estimates for Macy's and Kohl's and look like they're going to be a little bit higher for Macy's but a little bit lower for Kohl's.

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I think what is the big issue there is going to be the estimates are calling for really pretty much stagnant revenue growth at some of these big department stores and let's just look at the third quarter I mean that was the back to school season and we saw that was softer than usual. We had the government shutdown last month even though we saw some of the department stores and on our stories that report monthly sales saying that it was OK in October but I think was a lot of promotion going on and we're gonna see that obviously continue into the holiday season.

Alright so the real story it seems to be here is that these revenue numbers are stagnant for these companies even though in my they might make it look like their earnings are hitting.

I think they're gonna have a lot of expense control, but also you really gonna need to watch what their margins are because again you know it's a lot of promotional activity so that could hurt margins for sure.

Right, Kohl's of course always has those great coupons. Let's look at the stocks though because up even though we're talking about the stagnant revenues a coupon for promotions you know the Macy's stock has started to comeback just a little bit here as well as the Kohl's stock.

I think what's going on in the retail just sort of what's going on with the broader market they just really riding the wave of this stock market right now.

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