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Disappointing October Same Store Sales
Someone please explain how Larry Kudlow looks at October same-store sales numbers and concludes that this batch of data is a tremendous improvement. Out of the core 9 companies, only three (Costco, Gap and Nordstrom's) met or beat analyst estimates, while 6 missed consensus: JCPenney, Kohl's, Limited, Macy's, Target and TJ Maxx. And this is on the foreground of October of 2008, when people were afraid to leave their homes, let along shop for alligator skin purses (or murses).
Oh, but yes, following word for word from the administration's play book, even the companies that missed expectations are promising, nay, swaering, they will do much better in the critical November sales period. If only there were any idiots left who believe this garbage anymore.
A more politically correct summary courtesy of Goldman Sachs (Zero Hedge has no intentions of raising equity, or advising on M&A or restructuring opportunities, for any of these companies which could be a reason for the stylistic differences):
Same-store sales continue to be mostly negative in the low-single-digit range, but the focus on inventory and cost control initiatives is expected to continue to help margins. Gap, J.C. Penney, Kohl’s, and TJX, all raised earning outlooks for the third quarter. The best relative performers on October SSS were Gap and Nordstrom, which exceeded expectations by 2.4% and 3.5%, respectively.
A more granulary analysis store by store:
- Costco's same-store sales for October 2009 were up 5.0% compared with expectations of up 4.7%. Total sales for October 2009 were up 7.5% to $5.70 billion compared with $5.30 billion in October 2008. US segments were up 2%, while international segments were up 17% excluding the
negative impacts from gasoline deflation and foreign currency. - Gap Inc.'s same-store sales for October 2009 were up 4.0% compared with expectations of up 1.6%. Total sales for October 2009 were up 5.6% to $1.14 billion compared with $1.08 billion in October 2008. Gap Sales were down 6%, Banana Republic sales were up 5%, Old Navy sales were up 14%, and International sales were down 4%.
- J.C. Penney's same-store sales for October 2009 were down 4.5% compared with expectations of down 2.3%. Total sales for October 2009 were down 3.5% to $1.31 billion compared with $1.36 billion in October 2008. Women's apparel and shoes were the top-performing divisions, while
jewelry continued to experience weaker sales. Sales were strong in the first two weeks of the period, but turned softer and were below expectations in the final week. - Kohl's same-store sales for October 2009 were up 1.4% compared with expectations of up 6.2%. Total sales for October 2009 were up 5.0% to $1.27 billion compared with $1.21 billion in October 2008. Home business was the strongest division, while the Southwest continued to be the strongest region.
- Limited's same-store sales for October 2009 were down 4.0% compared with expectations of down 2.7%. Total sales for October 2009 were down 3.3% to $0.56 billion compared with $0.58 billion in October 2008. Victoria's Secret sales were down 6%, La Senza sales were down 7%, and Bath and
Bodyworks sales were up 2%. - Macy’s Inc. sales for October 2009 were down 0.8% compared with expectations of down 0.1% Total sales for October 2009 were down 1.7% to $1.69 billion compared with $1.72 billion in October 2008. Online sales were up 34.6% for the month.
- Nordstrom's same-store sales for October 2009 were up 6.5% compared with expectations of up 3.0%. Total sales for October 2009 were up 14.7% to $0.61 billion compared with $0.53 billion in October 2008.
- Target’s same-store sales for October 2009 were down 0.1% compared with expectations of down 0.0%. Total sales for October 2009 were up 2.9% to $4.54 billion compared with $4.42 billion in October 2008. Management said comparable store sales in apparel were slightly stronger than for the company overall.
- TJX's same-store sales for October 2009 were up 10.0% compared with expectations of up 10.1%. Total sales for October 2009 were up 14.9% to $1.70 billion compared with $1.48 billion in October 2008. Same-store sales increased 12% at The Marmaxx Group – the combination of T.J. Maxx and Marshalls. The company expects 3Q2010 EPS to be at or slightly above recently raised guidance of $0.77-$0.79; consensus estimates are currently $0.75.
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Easy. They hand Kudlow a piece of paper that says "This is a great report.", and he reads it.
Reason why retail sales is not falling as much as expected is because the fed's mandate of low interest rate and neverending QE is giving Americans the perception that the dollar is just gonna keep tanking. If thats the case, it makes perfect sense to buy as much as you can with your money right now because in 2 years, you may only get 1/4 of what you get now. Now of course, thats one way to protect yourself from future hyperinflation...or we can just all group up in front of the White House and start demanding change. Either way, we gonna be screwed but I prefer the way where we die trying and not die starving.
uhhh uhhh..sorry I couldn't begin to explain anything about that guy.
cocaine is a helluva drug
--Rick James (beyotch)
Off topic, but I am surprised I havent seen any comments on the daytime CNBC crew's recent makeovers. Melissa Francis, Sue Herera new facials cleaner makeup and Michelle's tighter than usual sweaters. Nobody has noticed? I must be the only one that still watches it I guess. I swear its not my choice, I petitioned my office to switch the satellite channel to Bloomberg but NOBODY! wanted to....go figure.
Yes, you are totally correct.
The Anchorettes are under enormous pressure with the ownership changes.
Michelle and "B-Cups" Burnett have been extra flirty lately.
Melissa Francis is now wearing heavily padded push up bras.
Melissa Lee desperately needs improvement.
Overall, there will be a run on plastic surgery, tummy tucks, and some like Sue Herrera will be desperate enough to get the Lap Band installed this weekend.
I think it will come to the point where all sense of direction is lost and finally one day Dennis Kneale shows up wearing beehive wig and a bullet bra.
Oooo, count me in. I'd like to see that. At minimum, Comcast could take away his Blackberry and Cellphone again. That should bring for some interesting viewing.
robo...promise me if you are ever in ny you will have lunch on this old guy.
you are a corker!!
I am not sure all of the talent on Bloomberg is worthy of looking at though i.e. Sue Keenan (tranny?). Others are very worthy though; Deidre and Zahra (miss Jamaica)
It is going to get a lot worst for retailers. High credit card interest rates, high unemployment, and unemployment checks are running out doesn't look good anyway you spin it.
The worse is over. Next month is worser, soon to be followed by the worsest yet.
What would be even more worsterest, would be a crash in hermit crab futures.
Oh well, could be worsera.
mostly negative is the new doing good.
Larry Kudlow is the man who couldn't understand why gold was at the high price of $400 per oz. Say no more.
Ironic, that several department stores cited weakness in the back half of the month which could carry over into November.
Saks already on their 3rd "online designer sale" mass email. 20% off last week, 40% off this week (clearly pales in comparison to their panic driven 70% off sale last year. but still 1st week of november 40% off?)
"Ironic, that several department stores cited weakness in the back half of the month which could carry over into November."
In my neck of the woods (CA) welfare checks are handed out on the first of the month. The restraunts are packed until they run out of money around the middle of the month. The same thing happens at the malls around here.
I honestly think the "less extreme" clearance prices and closing down of competitors/weaker stores are making these yoy "improvements" look better than reality.
lizzy...my wife watches all the retail stuff for me and from what she tells me, these guys are hurtin' pretty bad.
Tyler, please refrain from referring to them as the 'Administration' and give them their more appropriate title the 'Regime'.
Tia.
Larry who? Tyler, stop giving whoever that is so much credibility.
I love it when Kudlow opens his mouth and his head disappears...
My Dad refers to Larry as puppetman and is waiting for the day that CNBS reveals who's hand is up his tookus.
His orifice must be very big (wide?) to have an entire hand up his tookus. Maybe that's why his face flashes between pain and pleasure.
Watch carefully if you can stomach it. Turn down the sound and watch his face. This is clearly a tormented man with demons close to the surface.
Unfortunately numbers don't mean jack anymore.For instance check out ANF with sss of -15% on expected -14.7.Quant traders then proceded to bring out the napalm on the shorts less than ten minutes into trading at one point with a 6.5% roasting.Let the madness continue, bad news is good.
this report could be put in a table to eliminate the prolix verbiage....and comparisons with estimates is either another article or completely irrelevant...ytd comparisons are the only relevant comparisons.....
I think it's because for the most part sales went up, which suggests that we may have hit a bottom in terms of the retail sales plunge. If it missed analysts' consensus, who cares, I guess. In terms of the individual stocks, I suppose that's bad but as a sign of the economy, it suggests that sales have bottomed. What that means in terms of actual recovery, who knows.
If it's a bottom it's a false one, based on the false belief that things are "getting better" in terms of the larger economy.
After exhibiting the patience of Job for many months, I finally decided to short XRT yesterday. I may still get my ass handed to me by Benny and the press but at some point, it may occur to folks that Main Street, i.e., the customer for all these stores, is the one interest NOT getting bailed out.
I do like his new catch phrase "You can't devalue your way to prosperity"
On a another important subject that MSNBC is misreporting. Government unemployment stats exclude those people who roll over to state emergency unemployment compensation (about 90k) and those poor souls who roll out (used up all of their beneifts. Instead of a 68k drop in unemployment claims there was a 22k increase (deterioration not improvement). lies, lies and more lies....
I believe you are talking about Continuing Claims, right? I think CC takes a back seat to the Initial Claims data. The market got all excited over a "low" IC number. God knows why. There are only so many jobs you can cut. That number has to get lower by virtue of simple math - there are fewer people to lay off.
Cosco now sells a 74 day ration bundle. Expect sales to rise dramatically soon. Maybe they will have a "food 4 gold" program.
probably a better, more complete list here
https://www.briefing.com/GeneralContent/Active/PrintPage/PrintPage.aspx?...
TJX, ROST, and other off-price retailers are performing solidily (predictably). the ARO miss is an interesting one; they were a quality performer along with BKE. M VS JWM is another odd one; JWM with a better discounting strategy.
Econoday seems to agree with Kudlow:
"Chain stores reported mostly strong results in October, not uniformly strong but strong enough to indicate gains for the ex-auto ex-gas category in the monthly retail sales report from the Commerce Department. ... October's results are likely strong enough to offset less favorable seasonal adjustments compared to September. The most striking comments from today's reports are strength for home furnishings and furniture, a turn that may reflect improvement in the housing sector. ... Auto sales look to be very strong vs. September based on Tuesday's manufacturer data."
Larry must be dipping into the cocaine again......
it's all strong compared to "expectations", while completely dismissing the YoY figures. It's all about less bad and beating low-ball estimates.
On a related note, I can't get over the notion that consumers in this country will resume spending very much as they always have once things appear to be behind us. Generally speaking we are not that bright as a country when it comes to financial matters, and we have a huge sense of entitlement and instant gratification. I suspect a large number of people will simply refuse to adjust their lifestyle, or worse, expect somebody (i.e., the gubbmint) to bail them out down the road. After all, the banks got theirs, so Obama better give me mine!
This is obviously good because it is not worse.