Same-store sales at U.S. retailers in January topped analysts’ estimates, led by Limited Brands Inc. (LTD) and Target Corp., as shoppers took advantage of post-holiday discounts.
Sales at Limited, the Columbus, Ohio-based operator of the Victoria’s Secret lingerie chain, climbed 9 percent, beating the average projection for a 2.7 percent gain from analysts surveyed by researcher Retail Metrics Inc. Target, the second-largest U.S. discount retailer, posted a 4.3 percent increase in same- store sales, topping the 2.4 percent estimate.
More shoppers cashed out their holiday gift cards and sought out clearances on winter apparel, according to a Bloomberg Industries report. The consumer comfort index improved in December, meaning shoppers were more inclined to spend, according to a Goldman Sachs Group Inc. weekly retail note.
“The consumer continues to be resilient and sought out all the good deals, propelled by momentum for a strong holiday season” Alison Paul, retail sector leader at Deloitte & Touche LLP in Chicago, said in a telephone interview. “Milder winter weather could have encouraged people to get out and shop.”
Gap Inc. (GPS), based in San Francisco, beat estimates as sales fell 4 percent compared with an estimated decline of 5 percent. The largest U.S. apparel chain said it expects fourth-quarter earnings to be as much as 42 cents per share. That beats the 35- cent estimate of 29 analysts surveyed by Bloomberg.
Gap rose 11 percent to $21.52 at the close in New York for the biggest gain since Nov. 21, 2008.
Excluding J.C. Penney (JCP) Co. and Walgreen Co. (WAG), same store sales for the 20 companies tracked by Swampscott, Massachusetts- based Retail Metrics advanced 4 percent, beating estimates for a 3 percent gain.
J.C. Penney didn’t report monthly results today, while Walgreen won’t report until tomorrow.
Department store chain Macy’s Inc. (M) missed estimates with a 2.4 percent gain, compared with a 3.8 percent prediction. Dillards Inc. (DDS), the Little Rock, Arkansas-based department store, also trailed expectations, reporting little change in sales. Analysts had predicted a 3 percent gain.
“Expectations for the department store sector might have been too high,” Paul said in a telephone interview. “Those stores rely on winter attire such as heavy coats, which haven’t been as necessary this year.”
Macy’s shares rose 3.7 percent to $35.23 in New York. Dillards rose 3 percent to $45.22.
Most chains count locations open at least a year to tabulate same-store sales. The revenue is a key indicator of a retailer’s growth because new and closed sites are excluded.
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