JWN

JC Penney Brings Back Discounting; Was the Fourth Quarter Horrible?

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Last week, rumors swirled that JC Penney (click ticker for report: ) was pressuring its suppliers to place MSRPs (manufacturer’s suggested retail price) on its products so JCP could appear to be giving consumers a discount on a product (a sale without it actually being on-sale). Earlier today, that move was confirmed, and sales and MSRPs will be reintroduced at Penney’s stores around the country. Much-maligned CEO Ron Johnson noted that the strategy shift was an “evolution” rather than an admittance of failure.  Yet, the idea of including MSRPs or comparable prices isn’t at all a unique idea—just look at any TJX (click ticker for report: ) store, Nordstrom Rack (click ticker for report: ), or Ross (click ticker for … Read more

Can Eddie Lampert Turn Around Sears?

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Earlier this week, Sears (click ticker for report: ) CEO Lou D’Ambrosio announced that he’ll resign from his position in February due to an illness in the family. Not so surprisingly, Sears chairman and hedge fund titan Eddie Lampert will be taking the reigns as CEO. Lampert, who merged Sears and Kmart several years ago, will be the chief executive for the first time, and as far as we can tell, he seems confident in his ability to turnaround the failing retailer. In an interview with the Chicago Tribune, Lampert cites Jeff Bezos’ success as a finance guy turned retailer leading Amazon (click ticker for report: ) as evidence that he can turn the dying company around. Although he hasn’t … Read more

December Retail Sales Roundup

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Let’s take a look at retailers that still report monthly results. Nordstrom Nordstrom’s (click ticker for report: ) December was strong as usual, with same-store sales jumping 8.6% and total sales increasing 9.4%. We saw some weakness from the full-line Nordstrom store in November, but that trend was reversed by an 8.2% same-store sales gain in December. Nordstrom Rack continued to post fantastic results, with an 8.1% jump in same-store sales for December. All retailers benefitted from a more favorable calendar compared to 2011, but we think Nordstrom’s execution was strong regardless. Nordstrom continues to be among our favorite multi-line retailers, but we think its shares are fairly valued at current levels. Unlike other retailers, we aren’t worried about gross … Read more

November Retail Sales Disappoint

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Without question, November retail sales numbers have been lackluster. Although the number of retailers that report monthly sales figures continues to decline, let’s take a look at some of the interesting insights we saw from those that still report numbers. Kohl’s Even though we’re fairly bearish on Kohl’s (click ticker for report: ) over the long term, we did not expect the fourth quarter to start off so poorly. Same-store sales fell 5.6% year-over-year, lapping a 6.2% decline during the same period in 2011. Total sales fell 4.9%, and the company continues to lose momentum. The firm blamed Hurricane Sandy and recognizing e-commerce sales in December as the major drivers of weakness, but we think the results highlight how poorly … Read more

Macy’s Posts Strong Earnings; Provides Bold Fourth Quarter Sales Outlook

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Department store retailer Macy’s (click ticker for report: ) reported solid third quarter results Wednesday morning. Sales increased 3.8% year-over-year during the quarter to $6.1 billion, roughly in-line with consensus expectations. Earnings rose 12.5% year-over-year to $0.36 per share, exceeding consensus estimates. As we discovered earlier this week, revenue was driven higher by a 3.7% increase in same-store sales, as well as continued strong performance from macys.com and bloomingdales.com, which grew a combined 40% year-over-year. Men’s tailored clothing, men’s shoes, women’s suits, handbags, furniture, and watches were all cited as strong performers, with juniors, tabletops, and housewares lagging. Most areas were consistent with broader trends we’ve seen across retail as of late; men continue to return to a more formal, … Read more

October Retail Roundup

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During October, the US consumer remained resilient while much of corporate America stagnated in anticipation of the presidential election and the looming fiscal cliff. Let’s take a look at retail sales results for the month. Nordstrom Nordstrom (click ticker for report: ) continues to be a standout performer in the luxury retail space, with October same-store sales surging 9.8% year-over-year. Nordstrom Rack continued to outperform the traditional stores, growing 10.5% year-over-year compared to 10.2% for traditional stores. We remain huge supporters of the firm’s expansion plans, and we believe its execution is unbeatable in the retailer industry. Nevertheless, we believe shares are fairly valued. Gap Gap’s (click ticker for report: ) October results weren’t quite as strong as September results, … Read more