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March Same Store Sales- Expectations of Decline are Probably Baked In — Thursday, April 7 before the open will be the time when most U.S. retailers will report same store sales, or revenues from stores that have been open for at least one year.  Analysts largely expect March sales to have fallen a bit due to higher gasoline prices and a later than usual Easter date.  (Easter is on April 24 this year compared to April 4 last year, and SSS are reported as y/y figures.)

What the analysts are expecting:

- Decline of 0.9% for March sales (March ’09 SSS were +9%)
- Should the average show a decline in sales, it would mark the first drop since August 2009
- Weakness in sales due to low consumer confidence and higher food and gasoline prices (note: gasoline prices are ~$3.66/gallon compared to ~$2.83 last year), although one strategist at Kurt Salmon says it generally takes 4-6 months of sustained price changes to change consumer behavior
- Forecast for later on in the year: clothing prices will rise due to higher cotton and transportation costs
- KSS to post one of the largest declines
- TGT and M already have come out saying that SSS figures will likely show a decline in March, but a rise in April
- Department stores expected to show weakest sales numbers
- COST expected to post among the largest gains as the discount retailer had one more day of sales in its March period and also sells gas at some locations
- Retailers that target college students may have fared better than children/teenagers since college spring breaks fall in March whereas elementary/high school spring breaks fall later in accordance with the later Easter date
- LTD also expected to post one of the biggest gains

Bottom line: Don’t be surprised to see a bunch of declines in same store sales.  However, I do believe that this expectation has already been baked into prices.  Retail stocks have been relatively weak compared to the broader market so it is my belief (and hope, especially for TGT) that once the numbers are out of the way tomorrow, money will be able to flow back into these retail names.