U.S. Retailers’ November Sales Top Estimates on Early DealsLindsey Rupp
U.S. retailers including Costco Wholesale Corp., L Brands Inc. and Gap Inc. posted November same-store sales that exceeded analysts’ estimates as early discounts prompted consumers to start spending for the holiday season.
Same-store sales for retailers tracked by Swampscott, Massachusetts-based Retail Metrics Inc. rose 5.2 percent last month, excluding results from drugstores. Analysts’ had estimated a 3 percent gain.
Retailers began offering holiday deals earlier than ever this year, while lower gas prices, declining unemployment and consumer confidence at the highest level since the recession helped drive shoppers to spend more. The discounts early in the month may explain why sales in the days following Thanksgiving were weaker than some analysts’ had estimated.
“November was OK -- certainly retailers were promotional in November, and that probably contributed to it,” Ed Yruma, a New York-based analyst at Keybanc Capital Markets Inc., said in an interview. “The week before Black Friday we saw retailers begin to pull promotions forward. We saw generally soft results for the weekend and that’s because they pulled some of those sales forward.”
Gap, the largest U.S. apparel-focused retailer, said comparable-store sales increased 6 percent, exceeding estimates for a 1.6 percent decline. The San Francisco-based company’s results were led by the value-driven Old Navy brand, which posted an 18 percent same-store sales increase last month, beating estimates for a 0.5 percent gain.
Same-store sales also exceeded expectations at the company’s other two major brands. The Banana Republic chain saw sales grow 2 percent, exceeding a forecast for a 0.6 percent decline, and sales at the namesake brand declined 4 percent, less than the 4.5 percent predicted.
Shares of Gap rose as much as 4.8 percent to $42.50 in extended trading in New York. The stock had gained 3.8 percent this year through the close of trading yesterday.
L Brands, which owns the Victoria’s Secret and Bath & Body Works brands, said in a statement today that comparable-store sales rose 8 percent last month, exceeding the estimate for a 4.1 percent increase. Shares of the Columbus, Ohio-based company rose 0.6 percent to $82.67 at the close of trading in New York.
Warehouse club Costco also topped estimates, posting a 9 percent sales increase in sales excluding fuel, compared with a forecast for a 5.7 percent gain. The shares rose 0.2 percent to $143.02.
Most chains 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 established stores.
A stable job market may be putting money into more consumers’ pockets for the holiday season. Jobless claims decreased by 17,000 to 297,000 in the week ended Nov. 29 from 314,000 in the prior period, the Labor Department said today in Washington.
A Labor Department report tomorrow is projected to show payrolls climbed in November by more than 200,000 workers for a 10th consecutive month and the unemployment rate held at a six-year low.
Falling gasoline prices are also leaving consumers with more money in their wallets. The national average for regular yesterday was $2.746, data compiled by Florida-based motoring club AAA show.
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