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Inside Retail (Aug 2nd, 2017)

Taylrd, an online men’s apparel company, launched August 1, bringing competition to Wal-Mart’s newly acquired Bonobos online brand. Wal-Mart bought Bonobos last month for $310 million in a cash deal. Taylrd’s brand message is similar to Bonobos’ message – that men want well-fitting clothes but do not want to spend the time shopping for them. About 80 percent of men have bought a pair of pants online in the last six months, with about 30 percent returning them because of fitting issues, according to Taylrd’s research. The company’s prices are about half of Bonobos’ prices. – RETAIL DIVE

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Under Armour Inc. (UAA) shares hit a record-low after the company after it reported a 2 percent decline in revenue from footwear in the second quarter. That’s down from a 58 percent gain in the second quarter of 2016. Instinet analyst Simeon Siegel said the slow footwear sales are “a big deal.” Under Armour announced it would trim its workforce by 2 percent, or about 280 positions, as it tries to improve efficiencies in getting shoes to the market. Half the jobs cuts will be made at its Baltimore headquarters. “We’re going to make a meaningful number of pairs of shoes this year that’ll give us the attention and the scale that we need in order to be a long-term player in this space,” CEO Kevin Plank said. Under Armour stock is down 37 percent year to date and down 53 percent the past year. – BLOOMBERG

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Automakers reported weaker-than-expected sales for July. Ford Motor Co. (F), Fiat Chrysler Automobiles (FCAU) and General Motors Co. (GM) are moving away from selling fleets to rental companies like Avis Budget Group (CAR) and Hertz Global Holdings (HTZ). Those rental fleet sales were down 20 percent from the year prior in the second quarter, according to Barclays. Ford sales fell 7.5 percent from July 2016, Fiat Chrysler sales were down 10 percent and GM’s sales were down 14 percent. New car sales have declined every month so far this year. – THE STREET

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Staples Inc. (SPLS) may spinoff some 1,500 retail locations to long-time rival Office Depot (ODP). Staples is in the process of being acquired by Sycamore Partners in a $6.9-billion deal. So, Sycamore would have to make the deal, which would result in the largest – in fact only – big box office-supply retailer. Staples had revealed in a June 5 filing that “Party A,” which the New York Post’s source says is Office Depot, had bid between $625 million and $700 million for Staples' retail stores in North America. The two companies have reportedly revived those talks after the Sycamore deal, which will take Staples private, was announced June 28. – NEW YORK POST

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Snow Park Capital Partners, an activist investor in Dillard’s Inc. (DDS), says the department store chain needs to consider selling its real estate portfolio. “Dillard’s is essentially an underleveraged real estate company that is masquerading as a low productivity retailer,” Jeffrey Pierce, Snow Park managing partner, told Bloomberg. He says about 25 percent of Dillard’s real estate portfolio is in valuable top-tier malls that can fetch about $650 per square foot. Snow Park holds about 2 percent of Dillard’s Class A stock. Dillard’s shares are up 22.3 percent year to date. – BLOOMBERG

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Ulta Beauty Inc. (ULTA) is fairly immune to negative impacts from Amazon.com (AMZN), but the company is likely to be impacted by a softening beauty market, Oppenheimer analysts say. The firm downgraded its rating on Ulta to perform from outperform with a price target of $270 after L’Oreal S.A. reported its second quarter results. L’Oreal’s chief marketing officer said the U.S. “has turned out to be difficult since January 2017.” Other analysts like Cowen & Co. remain bullish on Ulta. Cowen analyst Oliver Chen said “fears are overblown.” Ulta shares are virtually flat from the start of the year. – MARKETWATCH

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