SAN FRANCISCO -- If the financial results of apparel retailers like Chico's (CHS - Cramer's Take - Stockpickr), Talbots (TLB - Cramer's Take - Stockpickr) and AnnTaylor (ANN - Cramer's Take - Stockpickr) are an indication of their customers' shopping habits, you'd think all women over age 35 are sitting at home dressed in their pajamas.
How else to explain why so many women have stopped flocking to these stores the way they used to?
Chico's, once a Wall Street darling for its fast growth and soaring demand, has been grappling for the past year with a sudden sales slowdown and merchandise missteps. Late Wednesday, it posted a 28% decline in second-quarter earnings and missed analysts' targets, and shares were tumbling 10% in recent trading.
Coldwater Creek (CWTR - Cramer's Take - Stockpickr - Rating), another retailer catering to older women, was plunging 22% after its own earnings miss. Likewise, Talbots and AnnTaylor each reported weaker second-quarter results last week after the retailers required heavy markdowns to move merchandise.
Amid the weak results for the sector, retailers like Gap (GPS - Cramer's Take - Stockpickr - Rating) and Gymboree (GYMB - Cramer's Take - Stockpickr - Rating) have abandoned their efforts to go after women 35 and up.
So what gives? These women aren't refusing to shop and instead resorting to their old fuzzy slippers. Rather, analysts say the shoppers are spurning specialty stores, where merchandise has been off the mark, and heading to department stores like J.C. Penney (JCP - Cramer's Take - Stockpickr - Rating) and Kohl's (KSS - Cramer's Take - Stockpickr - Rating).
"There's no doubt that the department store business has gotten sharper in focusing on this customer," says Howard Davidowitz, chairman of Davidowitz & Associates, a retail consulting and investment banking firm. "They have raised the bar in their performance. I think they realized this is their meat and potatoes."