Giving Thanks for such an encouraging Black Friday, the FashionUnited Top 100 closed yesterday
at 1,250.57, rising by 15.17 points.
Most European shares advanced by Midday on Thursday in the absence of economic fundamentals from major economies and amid celebration of Thanksgiving Day holiday in the United States which lowered the volume. European concerns over Ireland and euro debt continued to shape European stocks. But in the US, closed markets were overshadowed by American retailers who sought to boost their bottom line and get a jump on the holiday shopping season by opening their doors on American Thanksgiving. Thus, and still in the Old Continent, the best performers in terms of added value to the index were led by LVMH Moet Hennessy Louis Vuitton which inclined 1.84% to settle at €118.95.
Generally speaking, J. Crew's takeover has boosted the stock prices of several other retailers, possibly because this acquisition -- and that of Gymboree (NASDAQ:GYMB) earlier -- is stoking interest in the sector. Jim Cramer, a former hedge fund manager and host of CNBC's Mad Money, thinks the retail sector could see more M&A in the coming months. "Many retailers are selling at ridiculous prices to their long-term growth rates," said Cramer in an MSN Money commentary.
With such a hoping scenario, stocks that rallied in hopes of being the next buy-out target include Urban Outfitters, Abercrombie & Fitch, J.C. Penney, Gap Stores and Macy's among others, according to Cramer.
Taking other experts comments on this topic, Urban Outfitters holds an outstanding position, as its shares are up 6.74% year to date, under performing the S&P Retail Index, as a shift in fashion (more streamlined looks) and difficult comparable store sales comparisons led to moderating growth rates in each of 2Q10 and 3Q10. Consensus earnings estimates have been marked down, and though analyst enthusiasm on the stock remains high, there is a general agreement that the near-term for Urban will be short of historical growth patterns.