Shop Talk

Retailers, consumers and prices

Pay rent, buy food, fill up tank … buy jeans?

December 11, 2008

PERU/We know, dear fashionable readers, that, much as you like to look good in your jeans, the idea of shelling out $300 for said casual apparel item just doesn’t sit too well in a recession.
    
Apparently others think so, too, and premium denim maker True Religion might just be starting to notice.
    
Wedbush Morgan’s Jeff Mintz wrote on Thursday that consumer weakness was finally catching up to True Religion, which has been riding a long streak of popularity even as other apparel makers and retailers have been down in the dumps.
    
“Recent channel checks suggest slower business in the company’s retail stores,” Mintz wrote, adding that the change from October and November was “significant.”
    
“The post-Black Friday lull has left the stores much quieter and, we believe, could be a sign of slowing demand for the brand due to the difficult consumer economy,” he wrote.
 
Mintz cut his price target on shares to $17 from $23. Shares are down 35 percent since January.
    
True Religion raised its 2008 outlook last month, posting a 65 percent rise in third-quarter sales and a 76 percent rise in net income. But Mintz wrote that the company’s outlook was still achievable, despite what he called a lagging sportswear business due to relatively higher prices and “less compelling non-denim product.”

Ok, so maybe jeans are still recession-proof, but paying $172 for a hoodie? Maybe not so much.

But you tell us, readers … is buying premium denim a no-no today?

(Reuters photo of jeans NOT sold by True Religion)

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