Feb. 7 (Bloomberg) -- Macy’s Inc., Gap Inc. and Target Corp. led U.S. retailers to the biggest monthly same-store sales gain in more than a year as shoppers snapped up discounted merchandise chains were clearing out after the holidays.
Same-store sales at Macy’s, the second-largest U.S. department-store chain, advanced about 12 percent, surpassing the average projection of 5 percent from analysts surveyed by researcher Retail Metrics Inc. Gap, the largest U.S. apparel chain, boosted sales 8 percent, doubling the average estimate of 4 percent. Target, the second-largest U.S. discounter, posted a gain of 3.1 percent, above projections of 1.7 percent.
Shoppers were buoyed by gains in housing values and the U.S. stock market, with the Standard & Poor’s 500 Index adding 5 percent for its largest monthly increase in more than a year. Same-store sales for the more than 20 companies tracked by Retail Metrics surged 4.5 percent, the biggest gain since September 2011.
“After three or four years of tough recessionary pressures, consumers and retailers aren’t fatigued,” Paul Swinand, an analyst for Morningstar Inc. in Chicago, said in a telephone interview. Last month’s results bode well for the spring shopping season, he said.
A report today added credence to that sentiment as the Bloomberg Consumer Comfort Index for the period ended Feb. 3 rose, the first gain in five weeks.
Analysts surveyed by Swampscott, Massachusetts-based Retail Metrics estimated same-store sales would rise of 2.8 percent last month after a gain of 2.6 percent in December. Most merchants tally same-store sales using locations open at least a year, making the figure a closely watched gauge of a retailer’s health because it tracks only at established stores.
Today is the last monthly sales report for four of the largest U.S. retailers as Target, Macy’s, Nordstrom Inc. and Kohl’s Corp. will now provide same-store sales on a quarterly basis.
Macy’s, based in Cincinnati, rose 2 percent to $40.27 at the close in New York. Gap, based in San Francisco, fell 3 percent to $32.23. Minneapolis-based Target slid 0.6 percent to $62.30.
Macy’s said preliminary fourth-quarter profit excluding some items was $1.94 to $1.99 share, up from a previous projection of $1.91 to $1.96.
Limited Brands Inc. posted a 9 percent gain in same-store sales, almost three times analysts’ average estimate. The company said it was “comfortable” with analysts’ current average estimate for fourth-quarter earnings per share of $1.73. Same-store sales this month will gain at a low-single-digit percentage rate as the business will be managed conservatively in light of volatile mall traffic, the company said on a recorded call. The shares fell 3.3 percent to $45.68.
Costco Wholesale Corp. said same-store sales gained 4 percent, excluding the effects of changing gas and currency prices. Analysts projected 4.1 percent.
Teen retailer Urban Outfitters Inc., which doesn’t report on a monthly basis, said fourth-quarter same-store sales including revenue from the Web gained 11 percent. Analysts projected 8.2 percent. When online sales were removed, revenue from physical stores was little changed, the company said.
The decline in companies reporting monthly same-store results continues defections that began about five years ago, when sales started to decline heading into the global recession, said Ken Perkins, president of Retail Metrics. With each month and another negative number, many retailers decided reporting wasn’t worthwhile because it focused investors too much on short-term results and created volatility in stock prices, he said.
“They have forever moaned about it being a pain in the rear,” Perkins said. The reduction in information is “unfortunate for investors.”
Next month fewer than 20 chains will post same-store sales, down from a peak of 60 in the middle of last decade, Perkins said. The largest remaining chain will be Costco followed by Walgreen Co., Gap and Limited.
“Some choose not to do it because of the nuisance factor, and it’s one more thing you have to explain when you are already giving out quarterly results,” Richard Galanti, Costco’s chief financial officer, said in a telephone interview. “At the end of the day, it is useful information, and we’ve done it for a long time.”
Chains that have already dropped the practice include Wal-Mart Stores Inc., the world’s largest retailer, J.C. Penney Co. and Abercrombie & Fitch Co. Department-store chains Dillard’s Inc. and Saks Inc. also have stopped reporting.
“What we are going to is really the industry standard,” Jim Sluzewski, a Macy’s spokesman, said in an interview. Getting rid of monthly sales reports also will prevent the misinterpretation of results when shifts in the calendar around holidays such as Easter make it difficult to compare months to the same periods a year earlier, he said.
For analysts covering these companies, it will make conversations with executives less specific because they won’t be free to discuss results on a monthly basis, said Brian Yarbrough, an analyst for Edward Jones & Co. in St. Louis.
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