Retail Stock Braces for Big Drop on SSS Miss

TLRD stock could breach long-term technical support today

Jun 14, 2018 at 9:08 AM
facebook twitter linkedin


Shares of Tailored Brands Inc (NYSE:TLRD) are bracing for a sharp drop at the open, after the Men's Wearhouse parent said same-store sales (SSS) rose a less-than-expected 2.1% in the first quarter, and reiterated its weak full-year guidance. This is offsetting quarterly earnings and revenue beats, with TLRD stock down almost 17% in electronic trading -- which would mark its biggest one-day loss since March 9, 2017.

Heading into today's trading, TLRD shares had been on a long-term uptrend -- nearly tripling in value year-over-year, based on last night's close at $33.45, and holding near their May 14 annual high of $35.94. Helping the retail stock along the way has been its 40- and 80-day moving averages, which are both at risk of being breached in today's projected sell-off.

tlrd stock daily chart june 14

On the sentiment front, short sellers have started covering their bearish bets -- which has likely had a positive effect on the stock. Short interest fell almost 15% in the two most recent reporting periods to 6.22 million shares, representing 12.8% of TLRD's available float. These traders will be sidelined from making any moves today, with Tailored Brands all but guaranteed to land on the short-sale restricted list.

However, there's plenty of room for analysts to chime in on the retail shares. Only two brokerages currently follow TLRD stock, with one maintaining a "strong buy" rating and the other sporting a lukewarm "hold" recommendation. Plus, the average 12-month price target of $35.50 is a 6.1% premium to last night's close.

 

 

 

These investors are using the market's volatility to their advantage and scoring triple-digit gains on many of their trades.

Even in today's sideways bear market, this trading strategy has continued to provide consistency and profitability to a small group of investors. By using this approach, these traders are removing directional risk and still hitting triple-digit returns. If you want access to this strategy, and lower risk with higher returns sounds good to you, then don't wait another minute.

Join us now to receive our next trades the moment they come out!

 

Common mistakes options traders make
 


 


 
Special Offers from Schaeffer's Trading Partners