Reports of the U.S. Consumer’s Demise Have Been Exaggerated (DE, DELL, ANF, SPLS, TGT, ETM, MEDQ)

It was another seesaw day on Wall Street with stocks eventually ending mixed. Target’s (TGT) earnings report once again showed that despite reports of their demise, the U.S. consumer keeps spending. Nonetheless, high-end retailers sold off again, perhaps due to lackluster guidance from higher-end clothing teen retailer Abercrombie & Fitch (ANF), which didn’t have the pricing power in the face of higher commodity costs that investors expected. However, A&F’s report itself was pretty good and the teen retailer, whose popularity has waned a bit, isn’t exactly the best luxury retail proxy, especially given the strong forecasts from other high-end retailers.

The Radio Stocks Index was the top performing tickerspy Index on the day, led by Entercom Communications (ETM) with a 6% gain. The Healthcare IT and Software Stocks Index was the day’s worst performing tickerspy Index, with MedQuist (MEDQ) down -7%.

Stocks ended the day mixed, with the Dow rising 4 points to 11,410 and the S&P adding 1 point to 1,194. The Nasdaq, meanwhile, fell -12 points to 2,511. Oil rose 93 cents to $87.58 a barrel, while gold advanced $8.80 to $1,793.80 an ounce.

In economic news, the Labor Department said its producer price index rose 0.2% in July following a -0.4% dip in June. Economists were expecting no change. Core PP, which excludes volatile food and energy prices, rose 0.4%, above the 0.2% consensus.

In earnings news, Deere (DE), the largest maker of agriculture equipment, said its fiscal third-quarter profit climbed 15% to $712.3 million, or $1.69 per share, from $617.0 million, or $1.44 per share, a year earlier. Revenue soared 22% to $8.4 billion. Analysts were expecting a profit of $1.67 a share on revenue of $7.52 billion. Illinois-based Deere said it expects 2011 equipment sales of $29.47 billion, above the consensus estimate of $29.05 billion. The company forecast a full-year profit of $6.40 a share. Shares of Deere fell -1.2%. Sixty-one pros held Deere in their portfolios at the end of Q1 and nearly 1,200 tickerspy members own the stock in their portfolios.

Shares of Dell (DELL) plunged -10.1% after the second-largest personal computer maker pared its fiscal 2012 sales forecast when it released quarterly results Tuesday after the close. The company cut its revenue growth estimate to 1%-5% from 5%-9%. For the
fiscal second quarter, Dell reported a profit of $890 million, or 48 cents a share, compared with $545 million, or 28 cents a share, a year earlier on revenue of $15.7 billion. On an adjusted basis, Dell earned 54 cents a share. Analysts had been expecting a profit of 49 cents a share on revenue of $15.76 billion. Nearly 50 pros held Dell in their portfolios at the end of Q1 and 920 tickerspy members own the stock in their portfolios.

Shares of teen apparel retailer Abercrombie & Fitch tumbled -8.7% after the Ohio-based company said higher commodities costs will be an issue in the second half of this year. The company said its second-quarter profit surged 64% to $32 million, or 35 cents per share, from $19.5 million, or 22 cents per share, a year earlier. Revenue climbed 23% to $916.8 million as same-store sales increased 9%. Analysts were expecting a profit of 29 cents a share.

Staples (SPLS), the largest office supplies retailer, said its second-quarter profit rose 36% to $176.4 million, or 25 cents per share, from $129.8 million, or 18 cents per share, a year earlier as revenue increased 5% to $5.82 billion. On an adjusted basis, Staples earned 22 cents a share. Analysts were expecting a profit of 20 cents on revenue of $5.64 billion. Staples forecast a third-quarter profit of 46-48 cents a share. Analysts were expecting 46 cents. For the full year, the company expects to earn $1.39-$1.45 a share. That tops the consensus estimate of $1.36 and previous guidance of $1.35-$1.45. Shares of Staples edged up 0.5%.

Tags: ANF, DE, DELL, ETM, MEDQ, SPLS, TGT