I've spent both time and cash at Buckle(NYSE: BKE) stores when I need some trendy but reasonably priced jeans. But neither the store visits nor my tracking of its corporate performance has compelled me to add the investment to my portfolio. And its newly released fourth-quarter report has not swayed my opinion.
Same-store sales for the quarter declined 0.1% compared with the same quarter a year ago. Meanwhile, competitor Pacific Sunwear(Nasdaq: PSUN) achieved comps of 2.2% for the quarter, but since that metric was below analyst expectations, its stock got tattooed. Buckle shareholders, however, shouldn't worry about the same happening to this stock -- mainly since analysts have come to expect mediocrity from this youth-oriented retailer.
In its prerecorded quarterly earnings commentary, management offered little color to describe Q4 sales. We learned that footwear sales increased slightly, but accessory sales declined. Meanwhile, sales of men's denim displayed some strength, but this was likely the result of markdown sales, which were also higher for this product category. As a whole, men's sales as a percentage of net revenues declined from 46% to 43%, and women's sales moved up to 57%. Regrettably, management offered no insight as to what steps it's taking to improve overall customer traffic and transactions.
The competition is definitely lapping Buckle many times over. Abercrombie & Fitch(NYSE: ANF), Wet Seal(Nasdaq: WTSLA), and Guess?(NYSE: GES) each outpaced Buckle's sales growth for stores opened more than a year. Even though it's edging out Gap(NYSE: GPS) and Hot Topic(Nasdaq: HOTT) in this metric, that isn't much of a consolation prize.
Analysts have low expectations for Buckle, but that doesn't make the company an ideal value play. Until it can prove that it has a successful strategy in place to get comps moving in the right direction again, investors should be looking elsewhere for opportunities.
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Fool contributor Jeremy MacNealy does not own shares of any companies mentioned.
