Retail Sales Winners and Losers

Includes: ANF, BKE, BONT, JWN, TJX
by: Matthew D. McCall
The question heading into this morning’s February Retail Sales number revolved around the health of the consumer after the holidays and the inclement weather that pounded the Northeast. As always, there were some winners and losers, and here is a look at a few. (It was much easier to find winners, as about 8 of 10 retailers beat the analyst estimates.)
Abercrombie & Fitch (NYSE:ANF) - Reports a 5% rise in sales versus the estimate of a decline of 7%. Stock is surging pre-market. The teen retailer has really turned things around and if consumer spending continues to improve it will be one of the biggest beneficiaries.
TJX Companies (NYSE:TJX) - Americans love a deal in good and bad times. The owner of TJ Maxx is a few days from an all-time high and February saw sales increase by 10% versus the 8.8% estimate. I feel the lower end of the spectrum will continue to do well even if economy improves and of course will be an option for consumers if the situation darkens. Stock is actually down on the news, possibly buy the rumor, sell the news action.
Buckle (NYSE:BKE) - The once high-flyer darling of Wall Street has struggled the last year after expectations ran too high for the Midwest retailer. February was a bright spot with sales up 5.1% versus expectations of a drop of 1.4%. This could be a turnaround story and buying off the highs is not a bad long-term play.
Nordstrom (NYSE:JWN) - Same store sales surged 10.3% for the high-end retailer. I actually sold my shares in Nordstrom yesterday at $38 because I felt it may have priced in the good news. That being said, I will look to reenter in the mid-$30’s.
Bon-Ton (NASDAQ:BONT) - The mid-tier retailers are my least favorite and Bon-Ton reported February sales of 0.5%, just below the 1.0% estimate. Stock is up early with the entire market, but I see the mid-tier retailers struggling as the year goes along and consumers migrate to the higher end or remain at the low end.
Disclosure: No positions

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