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HenryTo
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 Posted: Wed Oct 31, 2007 4:58 pm Post subject: Retail Industry Trends |
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Retailiers already bracing for the worst. The $64 billion question is, as always, how bad will this get and how much of this has already been factored into retail stocks?
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Retail Holiday Season May Be Modest
Tuesday October 30, 5:15 pm ET
By Betsy Vereckey, AP Business Writer
Sluggish US Economy May Weigh on Holiday Sales for National Retailers
NEW YORK (AP) -- U.S. retailers are bracing for a difficult holiday season, some industry watchers say, as higher gas prices and a sluggish housing market are expected to continue crimping consumer spending.
At a conference on Tuesday hosted by the Retail Marketing Society, a membership-based organization focused on the retail industry, some industry executives said holiday sales may be sluggish.
"This holiday season will be somewhat Grinch-like," said Carl Steidtmann, chief economist at Deloitte Research.
Steidtmann said retailers are preparing for the worst, especially given tightening credit and problems in the housing market. Steidtmann said it will be at least 18 months to two years before the housing market bottoms.
Merrill Lynch analyst Jaime Sheinheit said higher energy costs will weigh on consumer spending, noting that retailers have had trouble getting customers in the door. However, it's hard to tell whether the sluggish traffic is related to softening consumer spending or warm weather, Sheinheit said.
"Cold weather may spark shopping," she said.
In the luxury sector, Sheinheit said handbag maker Coach Inc. has warned of sluggish traffic in its U.S. stores. The company recently issued a fiscal second-quarter same-store sales outlook it called "conservative." Same-store sales are sales at stores open at least a year, and the industry metric is considered a key barometer of a retailer's health.
David Wolfe, creative director at Doneger Group, a buying office, said Coach has reached its saturation point with aspirational customers, who may not have the money to spend on these handbags but still want quality at a price.
Meanwhile, wealthy customers may help other luxury retailers this season, like Tiffany & Co., as spending patterns among the affluent tend to stay the same, regardless of changes in the economy.
Sectors that might fare better include teen retailers, Sheinheit said, noting that the income of their main customer, teenagers, usually stays the same. Companies in this sector include American Eagle Outfitters Inc. and Abercrombie & Fitch Co.
One company that may emerge stronger, Sheinheit said, is AnnTaylor Stores Corp., which has leaner inventory and a new product assortment at its lower-priced Loft division. In August, the company said it increased markdowns to reduce inventory heading into fall seasons at both its Ann Taylor and Loft stores.
"There is a lot of opportunity for Loft to improve margins this holiday season," Sheinheit said. "As always, what it comes down to is having the right product."
Last edited by HenryTo on Wed Jul 16, 2008 8:40 am; edited 2 times in total |
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rffrydr
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| Posted: Tue Jan 11, 2011 10:00 am Post subject: |
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ICSC said that chain store sales fell 3.2% w/w and rose 3.5% y/y. Expects improvement in the coming weeks. 2.5% growth for the full month is still expected.
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HenryTo
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| Posted: Mon Dec 20, 2010 11:43 am Post subject: |
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Retailing Today on the ongoing rise in dollar stores:
| Quote: | THE NEWS | MORE DOLLAR STORE ON THE WAY
GOODLETTSVILLE, Tenn. – Dollar General disclosed aggressive 2011 expansion plans recently that will give the company nearly 10,000 units by this time next year. At a meeting with financial analysts in New York last week, a senior executive from the company detailed various growth initiatives and put more meat on the bone regarding a goal of opening 625 new units next year in addition to remodeling or relocating another 550 stores. Dollar General will be opening roughly two stores a day in hopes of maintaining the momentum evident in third-quarter results released earlier in the month. Same-store sales of 4.2% in the third quarter were a modest deceleration from second and first quarter figures, but profits earnings per share of 37 cents exceeded analysts’ estimates and were markedly higher than prior year third quarter earnings per share of 24 cents. The company said gross margins expanded by 51 basis points to 31.4% as its expenses as declined 61 basis points to 22.8% of sales.
“Dollar General is having a great year,” is how chairman and CEO Rick Dreiling summed up the results. “We are executing our plans and delivering excellent performance for our shareholders. Even as the macroeconomic environment continues to be volatile for our customers, our strong result are top-tier among retailers.”
THE FIX Stick with what’s working
The recession put the wind at the back of such retailers as Dollar General as ever larger numbers of shoppers sought value and convenience from the company’s conveniently located stores. It is understandable then that Dollar General would keep the pedal to the metal as far as expansion is concerned, as the company expects to end this year with 600 new stores and 550 remodels or relocations completed. A similar situation exists at Family Dollar where the retailer’s existing base of roughly 6,800 stores will be supplemented by the addition of 300 new stores during the current fiscal year. The company also plans to place a greater emphasis on upgrading its store base with between 600 and 800 remodels planned.
The key for both companies, and the thing that is unknown at this point in the economic cycle, is how many of the customer who were gained as a result of the economic downturn will continue to shop at the company’s stores when they have the means to go elsewhere. |
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rffrydr
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| Posted: Tue Dec 14, 2010 10:08 am Post subject: |
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Trend is to sellout inventory into X'mas.
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HenryTo
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| Posted: Thu Dec 02, 2010 11:35 am Post subject: |
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Morningstar on ARO's 3Q earnings:
| Quote: | | Aeropostale's ARO top line decelerated more than expected in the third quarter, in part because of difficult comparisons and increased promotional discounts at rival premium teen chains that affected sales. Since unemployment among 16- to 19-year-olds remains high (27.1% as of October), we see no indication that these price cuts will abate anytime soon, and these discounts will probably weigh on Aeropostale's top line and margins for the rest of the year. While results came in below expectations, this had minimal impact on our valuation. We are maintaining our fair value estimate. Total quarterly revenue grew 6% to $600 million, driven by incremental sales from new stores, while same-store sales were flat (relative to the 10% posted during in the prior year). Head ing into the holiday season, year-over-year traffic was down slightly in November (comparable sales declined 1%), with the exception of solid Black Friday sales (comps up midsingle digits), validating our view that consumers will remain very event-driven. Although we believe Aeropostale's value proposition and family-oriented marketing efforts will continue to resonate well with consumers, we believe the firm will have to fight hard to retain its newfound customers. In our view, heightened competition from premium chains like American Eagle AEO and Abercrombie & Fitch ANF have affected traffic at the discount chain, a trend likely to continue in the near term. As a result, we project Aeropostale's top-line growth will decelerate to the midsingle digits in fiscal 2011, down from our forecast of high single digits in 2010. Th e quarterly operating margin contracted 270 basis points to 16.0% because of a 170-basis-points decline in merchandise margins and 100 basis points of occupancy cost deleverage, due in part to the opening of the new Times Square flagship store. In our view, a decelerating top line, greater sourcing costs, and increased competition in teen retail will probably weigh on margins in the near term. Therefore, we estimate that the operating margin in 2011 will contract to about 15%, down from the projected 16% in 2010. |
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rffrydr
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| Posted: Wed Oct 13, 2010 7:40 am Post subject: |
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Chain store sales rose 0.8% w/w and rose 2.6% y/y.
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rffrydr
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rffrydr
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| Posted: Fri Oct 08, 2010 6:39 am Post subject: |
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rffrydr
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| Posted: Tue Sep 07, 2010 9:51 pm Post subject: |
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Another look:
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rffrydr
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rffrydr
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| Posted: Sat Aug 28, 2010 12:34 am Post subject: |
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rffrydr
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HenryTo
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rffrydr
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| Posted: Thu Jun 10, 2010 5:37 pm Post subject: |
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Between June of 2009 and April of 2010, the S&P 500 had posted a gain on each day of the retail sales release.
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