Why Tiffany & Co. (TIF), Williams-Sonoma, Inc. (WSM) and Dollar General Corp. (DG) Are 3 of Today’s Worst Stocks

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Stocks logged a big gain for the second day in a row, unwinding a big chunk of the ground lost over the course of the prior four trading days. A strong upward revision to the last quarter’s GDP may have had something to do with it. While the Bureau of Economic Analysis initially suspected 2.3% GDP growth, it now says GDP grew 3.7% during Q2. That was enough to push the S&P 500 up 2.4% to close at 1,987.66.

Why Tiffany & Co. (TIF), Williams-Sonoma, Inc. (WSM) and Dollar General Corp. (DG) Are 3 of Today's Worst StocksNot every stock jumped into the bullish parade, however. Retailers Dollar General Corp. (NYSE:DG), Tiffany & Co. (NYSE:TIF) andWilliams-Sonoma, Inc. (NYSE:WSM) all found themselves considerably in the red on Thursday.

Dollar General (DG)

The good news: Dollar General managed to top earnings expectations for its second fiscal quarter of 2015. The bad news: sales fell short of expectations, and the company reeled in its same-store sales outlook. Spooked investors sent DG down a hefty 3% on the news, and the damage appeared much worse until a last-minute surge.

All told, last quarter, Dollar General earned 95 cents per share on sales of $5.1 billion. The pros were only expecting a bottom line of 94 cents per share of DG stock, but those same pros were also modeling a top line of $5.15 billion. It’s an unfortunate shortcoming too, because the company handily beat Q2 2014’s earnings of 83 cents per share and revenue of $4.72 billion.

The death blow to DG shares, however, was likely the outlook. The company now expects same-store sales for the full year to roll in at the lower range of its previously-suggested growth range of 3% to 3.5%. Same-store sales were only up 2.8% in Q2 for Dollar General, underscoring the need to be concerned.

Tiffany & Co. (TIF)

Things weren’t any better at the high-end retail end of the spectrum. Luxury retailer Tiffany & Co. saw its stock fall 2.3% on Thursday after it too reported earnings.

Overall sales were down just a bit, to $990.5 million last quarter. They would have been up 7%, however, had it not been for the unusually strong U.S. dollar … a currency situation which also may have crimped sales to tourists who chose not to come to the United States last quarter. Even so, the 9% increase in expenses last quarter led to a 15% drop in overall income.

Most troubling of all was the company’s full-year outlook. It’s a rarity, but Tiffany & Co. now expects per-share earnings to fall slightly this year, down from last year’s profit of $4.20 per share. Analysts had been calling for earnings of $4.24 per share of TIF stock.

Williams-Sonoma (WSM)

Last but not least, kitchen-furnishings retailer Williams-Sonoma may have done well relative to expectations in its second quarter of 2015, but the market was less than thrilled with the company’s third-quarter outlook.

Last quarter, Williams-Sonoma beefed up its bottom line to the tune of 9%, reaching a profit of 58 cents per share of WSM. That figure was in line with expectations. Revenue of $1.13 billion topped expectations of $1.11 billion for the quarter, in addition to growing 8.5% on a year-over-year basis.

WSM shares took their big 8% hit, however, in the wake of its third-quarter outlook. Williams-Sonoma only foresees profits to come in between 68 cents and 73 cents per share for the current quarter, while analysts had been looking for earnings of 75 cents per share of WSM stock.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/08/tiffany-co-tif-williams-sonoma-inc-wsm-dollar-general-corp-dg-3-todays-worst-stocks/.

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