Zacks_Analysts' Blog : Bon-Ton's Sales Plunge - Analyst Blog

Bon-Ton Stores Inc. (BONT) reported total sales of $181.0 million in May 2011, which dropped 2.9% from $186.5 million in May 2010. The company’s comparable store sales fell 2.3% for the month. The decline in revenues was primarily due to sluggish sales of warm weather clothing in the last two weeks of the month.

In the month of May, the categories that performed well were fine jewelry, better missy sportswear, hard home, cosmetics and shoes. The company’s eCommerce category also witnessed robust growth, primarily driven by strong online sales. Bon-Ton is also undertaking initiatives to improve the customers’ online shopping experience.

However, apparel, moderate missy, petite and large-size sportswear, men’s and children’s sportswear registered weak sales, which in turn hurt top-line results.

Bon-Ton’s year-to-date total revenue was down 2.0% year over year to $830.9 million and same-store sales plunged 1.4%.

Management experienced negative sales for the month of May, but expects revenue to improve in the month of June.

In the first quarter of 2011, the company’s total sales inched down 1.7% year over year to $649.9 million attributable to a 1.2% drop in the same-store sales. However, in April, total sales jumped 4.6% to $197.7 million and same-store sales grew 5.1%.

For fiscal 2011, the company expects same-store sales in the range of 1.0% to 2.5%.

The Zacks Consensus EPS estimates for the second quarter and fiscal 2011 are pegged at a loss of $1.35 and earnings of 72 cents, respectively. The estimates have not budged in the last 7 days, implying that the analysts do not see any near-term catalyst.

The stock has a Zacks #3 Rank, implying a short-term Hold rating. We also reiterate our long-term Neutral recommendation on Bon-Ton.

One of its competitors, Kohl’s Corporation (KSS) reported a 2.5% upside in total sales and 0.8% rise in same-store sales in the month of May.

York, Pennsylvania and Milwaukee, Wisconsin-based Bon-Ton has 275 department stores, which include 11 furniture galleries in 23 states in the Northeast, Midwest and upper Great Plains. Its brands comprise Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's, Younkers and Parisian.