This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Jim Cramer: Soul-Searching in Retail

NEW YORK (Real Money) -- There's an awful lot of soul-searching going on in retail right now. It's become one of those moments where management teams are wondering about what happened this quarter, which, for many but not all, was a very tough one. 

Just yesterday after the bell, three retailers that we expected more from, Gap (GPS), The Fresh Market (TFM) and Ross Stores (RST), delivered less. Some would say much less.

The Gap, fresh from giving shorts a slam about the head with some terrific monthly October comps, reported overall comps that were a total letdown and signaled that there was, in the word of excellent CEO Glenn Murphy, a lot of "fatigue" among the consumers. I didn't think the quarter was all that bad, but the Street, exemplified by BMO, thinks that the momentum has peaked, in part because of disappointing gross margins and that the lack of upside guidance could spell the end to the streak. I think that's severe, but the nation's largest apparel chain didn't give you much reason to hold on to it after that $37-to-$41 romp.

Ross Stores was a real puzzler. The quarter was worrisome on all fronts, including a marked deterioration throughout the quarter. I think it is safe to say after examining this quarter that Ross Stores is officially the poor man's TJX (TJX), without a lot of new assortment and without a lot of brand names that attracted shoppers. This terrific regional-to-national growth story may recover, but you could hear the analyst dismay as Ross lost its most-favored-nation status.

Must Read: Jim Cramer: The CEO You Love to Hate

But the most worrisome of the three was The Fresh Market because this one had real momentum not that long ago and seemed to be a legitimate challenge to Whole Foods (WFM). Lots of the conference call was devoted to two problematic cluster launches, Sacramento and Houston, that simply were disappointing, causing analysts to question whether this company could handle a nationwide rollout, so vital to maintaining that elevated 33 price-to-earnings multiple. That one will shrink quickly.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free

Markets

Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Our Tweets

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs