Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Bolsa de Madrid  >  Industria de Diseño Textil, S.A.    ITX   ES0148396007

INDUSTRIA DE DISEÑO TEXTIL, S.A.

(ITX)
  Report  
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsPress ReleasesOfficial PublicationsSector newsAnalyst Recommendations

New tastes, nimble fashion rivals squeeze top U.S. teen chains

share with twitter share with LinkedIn share with facebook
share via e-mail
0
08/22/2013 | 12:05am EDT
Customers leave an Abercrombie & Fitch store at South Park mall in Charlotte

(Reuters) - Abercrombie & Fitch Co (>> Abercrombie & Fitch Co.), Aeropostale Inc (>> Aeropostale Inc) and American Eagle Outfitters Inc (>> American Eagle Outfitters) have fallen out of fashion with fickle U.S. teen shoppers and aren't likely to win back their business anytime soon.

(Reuters) - Abercrombie & Fitch Co (>> Abercrombie & Fitch Co.), Aeropostale Inc (>> Aeropostale Inc) and American Eagle Outfitters Inc (>> American Eagle Outfitters) have fallen out of fashion with fickle U.S. teen shoppers and aren't likely to win back their business anytime soon.

The retailers, known as the "3As," have long been popular for their cool basics like jeans, hoodies and t-shirts. But young shoppers are now less interested in their logo-centric clothes and more eager to shop for electronics or go to low-cost, fast-fashion chains like Zara, Forever 21 and H&M that offer greater variety more quickly.

"The teen retailers seem to be not in style or in vogue at this point in time for their target consumers," said Bryan Keane, portfolio manager of the Alpine Global Consumer Growth Fund. "That usually does not turn around quickly,"

American Eagle on Wednesday gave a weak forecast for the fall, sending its shares to their lowest levels in a year and a half. American Eagle Chief Executive Robert Hanson told analysts the level of price slashing now is "unprecedented."

Aeropostale earlier this month said that comparable sales fell 15 percent last quarter, and Wall Street analysts expect earnings per share to fall by more than two-thirds to 21 cents this year.

It will report full quarterly results on Thursday, as will Abercrombie. Last week, Barclays lowered its profit estimate on Abercrombie because of the "intense promotional environment."

One of the big problems the 3A's face is a narrower clientele than that of H&M (>> H & M Hennes & Mauritz AB) and of Gap Inc (>> The Gap Inc.), which draw shoppers of all ages.

American Eagle gets about 80 percent of sales from its standard merchandise, and Hanson conceded that it's been tough to compete as his company tries to offer more fashion, more quickly.

"This team (young shoppers) wants to be fashionable but they don't want to spend a lot of money, and fast fashion works very well for that," said Eric Beder, a Brean Capital analyst, who has a sell recommendation on Aeropostale.

For example, H&M sells V-neck men's t-shirts for as low as $5.95, while Aeropostale t-shirts on clearance on Wednesday were priced at $6.99.

The result has been the constant pressure to discount. American Eagle's gross margin fell 3.6 percentage points last quarter to 33.8 percent of sales, below a more typical level of 40 percent.

Abercrombie declined to comment ahead of the its earnings, while Aeropostale and American Eagle did not return messages seeking comment.

FAST FASHION

The competition has only grown more intense as U.S. government statistics show young shoppers have gradually directed more of their spending toward electronics and less on clothes.

This comes as teens are facing lower employment levels this year, according to Challenger, Gray & Christmas, and their parents are grappling with higher payroll taxes, gasoline prices and a slow job recovery.

On top of all that, the three chains are facing an ever more crowded field as international 'fast-fashion' rivals are aggressively expanding in the United States.

H&M, a Swedish retailer, said its U.S. sales rose 10 percent in the first half of 2013 and it just launched a U.S. e-commerce site. It has 269 U.S. stores, after opening 40 last year.

Uniqlo, owned by Japan's Fast Retailing (>> Fast Retailing Co Ltd), is opening six more U.S. stores this fall with a goal of having 200 by 2020.

U.S. sales at Zara, owned by Spain's Inditex S.A. (>> Inditex SA), more than tripled between 2007 and 2012, according to Euromonitor International.

U.S. rivals are also stealing market share from the 3A's: Forever 21 Inc's sales rose 82 percent during that period.

These new chains are bringing new products, such as Uniqlo long johns that warm up on touch, making it risky to offer the same-old, same-old.

"There isn't a lot of innovative clothing out there for anyone, and there are plenty of other places to buy clothes if you want," said Wendy Liebmann, CEO of WSL Strategic Retail.

Aeropostale is moving away from its logo business, and adding more expensive, fashionable items. But KeyBanc analyst Ed Yruma said in a note last week the move is a "tacit acknowledgement that the targeted teen customer base may have moved elsewhere."

Last year, many apparel chains got a boost from the bright color jeans craze. But this year, analysts say there is no such must-have to bring teens into the stores.

"Sometimes, you have something unique that everyone has to have," said Jessica Bemer, an analyst with Snow Capital Management. "But the look is going to be very similar this year to last year.

(Reporting by Phil Wahba and Dhanya Skariachan in New York; Editing by Jilian Mincer and Tim Dobbyn)

By Phil Wahba and Dhanya Skariachan

Stocks mentioned in the article
ChangeLast1st jan.
ABERCROMBIE & FITCH CO. 0.31% 16.38 Delayed Quote.-18.50%
AMERICAN EAGLE OUTFITTERS, INC. -1.31% 16.255 Delayed Quote.-14.80%
CHALLENGER LIMITED -1.15% 7.73 End-of-day quote.-17.60%
FAST RETAILING CO., LTD. -0.33% 69270 End-of-day quote.28.04%
GAP INC -1.29% 17.62 Delayed Quote.-30.67%
HENNES & MAURITZ 0.17% 207.9 Delayed Quote.64.70%
INDUSTRIA DE DISEÑO TEXTIL, S.A. -0.85% 28.05 End-of-day quote.26.58%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on INDUSTRIA DE DISEÑO TEXTIL
10/17INDUSTRIA DE DISEÑO TEXTIL S A : Inditex opens its first international “fo..
PU
10/03HENNES & MAURITZ : H&M shares surge after first quarterly profit rise in two yea..
RE
10/03INDUSTRIA DE DISEÑO TEXTIL S A : Inditex and UNI Global Union celebrate the tent..
PU
10/03HENNES & MAURITZ : H&M shares surge after first quarterly profit rise in two yea..
RE
10/02Why Your Used Shirts Are Destined for the Dump and Not the Recycling Center
DJ
09/30INDUSTRIA DE DISEÑO TEXTIL S A : Forever 21, Teen-Focused Retailer, Files for Ba..
DJ
09/30Forever 21 Files for Bankruptcy -- WSJ
DJ
09/29INDUSTRIA DE DISEÑO TEXTIL S A : Forever 21, Teen-Focused Retailer, Files for Ba..
DJ
09/29INDUSTRIA DE DISEÑO TEXTIL S A : Forever 21, Teen-Focused Retailer, Files for Ba..
DJ
09/25Luxury leader LVMH, in green mode, laments Thunberg's pessimism
RE
More news
Financials (EUR)
Sales 2020 28 029 M
EBIT 2020 4 953 M
Net income 2020 3 792 M
Finance 2020 8 140 M
Yield 2020 3,69%
P/E ratio 2020 23,2x
P/E ratio 2021 21,9x
EV / Sales2020 2,85x
EV / Sales2021 2,64x
Capitalization 88 110 M
Chart INDUSTRIA DE DISEÑO TEXTIL, S.A.
Duration : Period :
Industria de Diseño Textil, S.A. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends INDUSTRIA DE DISEÑO TEXTIL
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 27
Average target price 28,97  €
Last Close Price 28,29  €
Spread / Highest target 23,7%
Spread / Average Target 2,42%
Spread / Lowest Target -29,3%
EPS Revisions
Managers
NameTitle
Carlos Crespo González Chief Executive Officer & Executive Director
Pablo Isla Álvarez de Tejera Executive Chairman
José Ignacio Fernández Chief Financial Officer
Amancio Ortega Gaona Non-Executive Director
Emilio Saracho Rodríguez de Torres Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
INDUSTRIA DE DISEÑO TEXTIL, S.A.26.58%98 162
KERING16.14%66 583
FAST RETAILING CO., LTD.28.04%65 139
ROSS STORES34.50%40 478
HENNES & MAURITZ64.70%35 671
ZALANDO88.15%11 694