Aeropostale, Target, Shoe Carnival Taken to Woodshed After Earnings

NEW YORK (TheStreet) -- Today we crunch the numbers on six retail stocks that had significant share price weakness since we profiled them earlier this month before they reported earnings.

Here are the profiles. "Crunching the Numbers" tables follow, on pages 2 and 3.

Aeropostale (ARO) ($3.98), down 10% since May 21. The company beat analysts' estimates for its bottom line, but that was with a loss of 52 cents a share. It also provided weak guidance. The stock traded as low as $3.37 on May 23 for another multiyear intraday low.

The weekly chart remains negative but oversold with its five-week modified moving average at $4.54. A weekly pivot is $3.83 with a monthly risky level at $6.86.

Shoe Carnival (SCVL) ($18.11), down 18% since May 21. The company missed analysts' EPS estimates by 2 cents by earning 45 cents. The stock traded as low as $18.05 on Wednesday, well below its 200-day SMA at $25.48.

The weekly chart remains negative but oversold. The five-week MMA is at $21.38 with the stock breaking below its 200-week SMA at $20.56. An annual value level is $16.86 with a weekly pivot at $20.33 and annual and quarterly risky levels at $24.20 and $25.69, respectively.

Staples (SPLS) ($11.34), down 14% since May 16. The company missed analysts' EPS estimates by 3 cents by earning 18 cents a share. The stock traded as low as $11.27 following earnings on Wednesday, well below its 200-day SMA at $14.05.

The weekly chart shifts to negative with a close this week below its five-week MMA at $12.20 and its 200-week SMA at $15.39. A quarterly value level is $10.14 with weekly and semiannual risky levels at $13.19 and $15.67, respectively.

Target (TGT) ($55.34), down 5.1% since May 19. The company matched analysts' EPS estimates by earning 70 cents a share. The stock traded to a postearnings intraday low at $55.25 on Wednesday, well below its 200-day SMA at $61.83.

The weekly chart remains negative with the stock below its five-week MMA and 200-week SMA at $58.30 and $58.44, respectively. Annual values are $54.45 and $53.25 with weekly and monthly risky levels at $58.34 and $60.95, respectively.

TJX Companies (TJX) ($54.30), down 7.3% since May 16. The company missed analysts' EPS estimates by 3 cents, earning 64 cents a share. The stock traded as low as $53.87 on May 20 well below its 200-day SMA at $59.02.

The weekly chart remains negative with its five-week MMA at $57.48. Annual value levels are $52.67 and $45.75 with a weekly pivot at $55.80 and semiannual and quarterly risky levels at $62.97 and $64.56, respectively.

Walmart (WMT) ($75.53), down 4.6% since May 13. The company missed analysts' EPS estimates by 2 cents, earning $1.13. The stock has been below its 200-day SMA at $76.29 since May 20.

The weekly chart is negative given a close this week below its five-week MMA at $76.79 with its 200-week SMA at $65.47. Annual value levels are $73.76 and $60.65 with a semiannual pivot at $75.89 and semiannual and weekly risky levels at $76.49 and $78.80, respectively.

Crunching the Numbers With Richard Suttmeier: Moving Averages & Stochastics

This table provides the technical status for the stocks profiled in today's report.

There are five columns with moving average titles: Five-Week Modified Moving Average; 21-Day Simple Moving Average; 50-Day Simple Moving Average; 200-Day Simple Moving Average; and the 200-Week Simple Moving Average.

The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with a reading of oversold, rising, overbought, declining or flat.

Interpretations: Stocks below a moving average are listed in red.

Five-Week Modified Moving Average (MMA) is one of two indicators that define whether a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.

A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.

A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.

A stock with a neutral technical rating has a profile that is not positive or negative.

The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance level and as a "reversion to the mean" over a rolling three- to five-year horizon. (Even Apple (AAPL) declined to its 200-week SMA in June 2013.)

The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three- to five-day horizon and vice versa.

The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.

The 200-Day Simple Moving Average is another technical support or resistance level, and I consider this level as a shorter-term "reversion to the mean" over a rolling six- to 12-month horizon. (Even Apple tested or crossed its 200-day SMA in nine of the last 10 years.)

Crunching the Numbers With Richard Suttmeier: Earnings & Where to Buy & Where to Sell

This table presents the EPS estimates including date and before or after the close, and where to buy on weakness and where to sell on strength.

"EPS Date" is the day the company reports its quarterly results.

"EPS Estimate" is the EPS estimate from Wall Street analysts.

Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.

Investors who wish to buy a stock should use a good-'til-canceled limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.

At the time of publication the author held no positions in any of the stocks mentioned.

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This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff

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Richard Suttmeier is the chief market strategist at ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.

Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.

Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.

Click here for details on Suttmeier's "Buy and Trade" investment strategy.

Richard Suttmeier can be reached at RSuttmeier@Gmail.com

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