Retail earnings have generally been strong, but the charts of several names in the sector look scary. Walmart and Lowe's beat analysts' estimates as consumers continue to spend. The trend is not all encompassing, however, with some stocks under pressure as consumers trim choices and limit day-to-day spending. Against this backdrop, CNBC Pro screened the SPDR S & P Retail ETF (XRT) for stocks that were forming a death cross chart pattern. These occur when a stock's 50-day moving average drops below its 200-day counterpart. Such a move tends to indicate that shares are losing momentum and could slip further. We found five SPDR S & P Retail ETF (XRT) components, including Ulta Beauty , that are on the verge of a death cross pattern — and one that has already formed one. Ulta Beauty Shares of cosmetic retailer Ulta have slipped more than 22% in 2024. Analysts have also decreased their target prices and ratings in recent months, with the percentage of buy or overweight ratings slipping from 50% in March to 48% as of Tuesday, FactSet data shows. The stock's 50-day moving average is less than 1% away from falling below its 200-day moving average. Stifel analyst Mark Astrachan lowered his target price to $475 per share from $565 earlier in May, over concern that the overall beauty market will see slower consumer spending. Ulta in particular, the analyst added, is facing stiffer competition that could hurt future earnings. "We also think Ulta is losing share to Sephora, reflective of a shift towards prestige beauty, and to Amazon from expanded offerings including in prestige with newer brands like Clinique and Lancôme," Astrachan said. Camping World Holdings Shares of the RV maker have declined about 24% in 2024 and it is also close to forming a death cross. The company reported earlier this month first-quarter earnings that missed analysts' estimates. Camping World has struggled since the height of the Covid-19 pandemic, when consumers sought recreational vehicles to foster outdoor activities amid mass social-distancing directives. Other stocks nearing a death cross pattern include National Vision Holdings and Academy Sports & Outdoors . Dollar Tree Dollar Tree has already formed a death cross chart pattern. Shares of the discount retailer have pulled back roughly 19% in 2024. The company's fourth-quarter earnings print disappointed investors, with Dollar Tree missing estimates for sales and profit during the holiday season. Even as consumers have increasingly shifted to cost-cutting efforts that would seemingly benefit Dollar Tree, the company is facing stiffer competition from retailers including Walmart and Temu. Dollar Tree also told investors in its most recent earnings report that it would close nearly 1,000 stores.
