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Teen retailers often have just as tough a time predicting adolescent trends as their parents do, “ Mad Money ” host Jim Cramer said Thursday.
“Have you ever, ever been able to figure out what they want from minute to minute, let alone month to month? I sure haven’t,” he said.
For this reason, Cramer said that companies whose bottom lines are tied to teenage tastes are tough to game.
“I’m constantly being bombarded by people saying isn’t this the month Abercrombie & Fitch will turn around? Or isn’t True Religion down enough? Isn’t this the moment for Aeropostale?” he said.
The short answer is no.
For companies such as Aeropostale and Abercrombie, whose problems are acerbated by European weakness, there is no sure thing when it comes to predicting what teenagers will want to wear next season.
Instead, Cramer suggested retail plays in companies who know their customer base well.
“Hence why we should be gravitating toward stocks like Macy’s and Gap, or Ross Stores and Costco, which understand their customers down to a T, or even a T-shirt, and aren’t dice-rolling a fickle teen consumer from month to month,” he said.
For more risk and more potential reward, try Amazon, which benefits from not having to stock up on inventory.
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