NY Times: Retailers Get Stingy With Data

[marmar]

Retailers Get Stingy With Data
By MICHAEL BARBARO
Published: April 17, 2008



J. C. Penney says the tumultuous economy is making it impossible to predict earnings over the next year. Macy’s asserts that providing monthly sales information is too distracting and confusing. And Starbucks argues that annual profit estimates are unnecessary.

In American retailing, less is suddenly more — at least when it comes to giving investors the sort of financial information they have long expected from companies.

Faced with an economic slump, a growing number of national retailers are abandoning the longstanding tradition of reporting monthly store sales and forecasting annual profits.

The stores say that they are eliminating outdated practices that encourage short-term decision-making and can confuse investors.

But many Wall Street analysts and investors, who rely on these numbers to gauge a company’s health and the mood of the American consumer, are crying foul. The motive for providing less financial insight, they suspect, is to avoid issuing embarrassing numbers in the middle of a recession, numbers that can drive down a company’s stock price.

So far this year, Starbucks, Macy’s, CVS Caremark and Jos. A. Bank have ditched one or both of the financial reporting practices that were once standard in retailing.

And on Wednesday, J. C. Penney joined the list, saying it would stop offering annual profit estimates, known in the industry as guidance, at least for now. (It will still provide monthly sales and quarterly profit estimates.) ......(more)

The complete piece is at: http://www.nytimes.com/2008/04/17/business/17retail.html?_r=1&ref=business&oref=slogin

[Rex]

1. annual profit estimates are unnecessary = we fired the forecasters

saved some money on that one.

[jayfish]

2. Is It Fascism Yet? -NT-