Coronavirus Rips Apart Apparel Industry: 4 Players Raise Alarm
Zacks Investment Research | Mar 11, 2020 09:28PM ET
The rapidly spreading novel coronavirus has rattled the stock market and almost disrupted economic activities worldwide — denting demand, hurting supply chain, slowing down production activities and temporary closure of brick-and-mortar locations. COVID-19, a global pandemic, has infected more than 121,000 people across Asia, Middle East, Europe and the United States, and the death toll has crossed 4,000.
The outbreak has wreaked havoc impacting industries like Auto, Pharma, Electronics, Tourism & Aviation, Technology, Restaurants, Cosmetics and Apparel. Several companies have cautioned regarding their upcoming revenues and earnings results. Quite apparent, a dip in consumer confidence — thanks to market turmoil — is likely to hurt the spending activity, and no doubt retailers will be at the receiving end.
4 Apparel Players Bearing the Brunt
Recently, Urban Outfitters, Inc. (NASDAQ:URBN) informed investors on current business trends that have emerged since its last earnings call on March 3. The apparel retailer informed that it has witnessed a fall in traffic and decline in sales across areas such as Milan, Italy and Seattle, Washington, which are severely impacted by coronavirus. However, this Philadelphia, PA-based company provided an update declaring that it has not experienced any significant impact across its stores in other locations and digital platform due to the outbreak.
Management stated that currently it is not in the position to forecast the impact of COVID-19 on the business in the first quarter. We note that shares of this Zacks Rank #3 (Hold) company was down 7.4% during the trading session on March 11. You can see Zacks Investment Research
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