Citigroup Slashes Its Estimates For Retailers

The estimate and target slashing begins in earnest.

Citigroup’s Deborah Weinswig just took it to some retailers.

Our Take — Pressures facing the U.S. consumer are mounting once again, driven by recent developments in the global economy and financial markets. We see increased risk to SSS and EPS growth for our retailers in the back half of 2011 and 2012. As a result, we are lowering our EPS estimates and price targets for seven retailers in our coverage universe. However, we believe that our retailers are in a stronger position than prior to the Great Recession, due to conservative inventory management and expense discipline, which should bolster EPS results in a difficult environment.

Lowering 2011-2012 EPS Estimates and Price Targets — We are lowering our 2011- 2012 EPS estimates for HD, JCP, JWN, KSS, LOW, SKS, and WMT based on our more cautious outlook. We are also lowering our price targets for these retailers.


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