Retail earnings run continues as Gap, Nordstrom ready Q2 updates

Gap Inc.  (GPS) - Get Free Report shares edged higher in pre-market trading ahead of the casual clothing retailer's second quarter earnings after the closing bell, which will also be paired with a similar update from upscale rival Nordstrom  (JWN) - Get Free Report.

Retail earnings over the July quarter have been mixed, with value-focused companies like Walmart WMT topping Street estimates and forecasting solid near-term gains, while those at the higher-end of the price scale have noted fading consumer demand heading into the autumn months.

Analysts expect Gap, which also operates the Old Navy and Banana Republic brands, to posted adjusted earnings of 9 cents per share for the three months ending in July, its fiscal second quarter, down around 50% from the same period last year.

Group revenues will likely hold up better, falling 7.5% to $3.57 billion, a move that likely reflects steep discounting in order to shift inventory builds from earlier in the year.

Nordstrom is also likely to see earnings fall much faster than sales, with its bottom line forecast at 45 cents per share, down 44% from last year, on revenues of $3.65 billion.

Both retailers are also likely to address the issue of theft, which hammered the prospects of big box rival Target last week as CEO Brian Cornell tallied the cost of organized crime that may lope as much as $500 million from its full-year profits.

Gap shares were marked 0.83% higher in pre-market trading to indicate an opening bell price of $9.73 each. Nordstrom shares, meanwhile, nudged 0.5% higher to $17.68 each. 

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