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Retailers Playing The Blame Game, But The Weather Excuse Is Often Confusing And Inconsistent

Retailers Playing The Blame Game, But The Weather Excuse Is Often Confusing And Inconsistent - American Eagle Outfitters, Inc. NYSE:AEO, Gap, Inc. The NYSE:GPS

When Macy's Inc M 0.05% reported its second-quarter results, the company attributed its better-than-expected same-store sales metric to several factors, including favorable weather.

Specifically, the company said in its press release that a "normalized weather pattern" helped to contribute to a sales left in its apparel business.

On the other hand, some of Macy's retailing peers that specialize in apparel actually blamed weather for their poor performances.

Consider American Eagle Outfitters AEO 1.26%, a specialty retailer with over 1,000 stores in the United States and internationally. It would be hard, if not impossible, to find a specific region in the United States where Macy's and American Eagle do not share a presence.

The company said during its post earnings conference call that its business was "impacted by unseasonable weather early in the quarter," but it did highlight improving momentum in June and July.

Analysts at Stifel also attributed Gap Inc GPS 2.4%'s poor same-store sales trends in July toward "unfavorable weather."

So, which is it? There is hardly a region in the United States where Gap and Macy's don't share a presence, either.

How can one retailer attribute poor results to weather while another attributes their positive results towards the exact same weather?

Home Improvement Companies Both Benefit And Suffer From Weather

Home improvement retailer Lowe's Companies, Inc. LOW 1.35% is an interesting case of a company that is able to both praise and blame weather in the same quarter.

Lowe's said during its post earnings conference call that the early start to spring created "robust demand for outdoor projects" and that "customers took advantage of favorable weather conditions in the first quarter to complete those projects."

On the other hand, the company also said, "As we moved into Q2, we saw softer comps in May stemming both from Q1 project pull-forward and unfavorable weather. Temperatures below normal in our northern regions prevented customers from enjoying outdoor projects."

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DateFirmActionFromTo
Aug 2016CitigroupMaintainsNeutral
Aug 2016SunTrust Robinson HumphreyMaintainsBuy
Aug 2016NomuraMaintainsNeutral

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