Holiday Slump Hits Weaker Chains -- WSJ
2020年1月10日 - 5:02PM
Dow Jones News
By Suzanne Kapner
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (January 10, 2020).
A strong U.S. economy and robust consumer spending weren't
enough to boost holiday sales at many department stores and
mall-based chains, as Americans continue to shift their purchases
online and to other retailers.
J.C. Penney Co., Kohl's Corp. and Victoria's Secret parent L
Brands Inc. all reported lower sales in the critical months of
November and December. All three companies entered the holiday
season on weak footing, with falling sales as they lost orders to
Amazon.com Inc. as well as traditional rivals such as T.J. Maxx and
Target Corp.
"Our customer data shows that a chunk of clothing spend from
Kohl's customers has migrated to other retailers, most notably to
Target and various off-price players," said Neil Saunders, managing
director of research firm GlobalData Retail. "This is reflective of
the weaker proposition at Kohl's but also underlines the success
Target has had in improving its own offer."
The sales updates came a day after Macy's Inc. reported its
comparable sales fell 0.6% in the holiday period and said it would
close 29 stores. Bed Bath & Beyond Inc. also reported a drop in
comparable sales for the third quarter. Comparable sales generally
include online sales and reflect stores open at least a year.
Not all traditional retailers are struggling. Walmart Inc. and
Target have reported rising sales and store traffic for much of the
past year, as they ramp up online ordering and in-store pickup
services. Off-price chains such as TJX Cos. have also logged
healthy sales.
Warehouse club operator Costco Wholesale Corp. reported
comparable sales jumped 9% in the five weeks ended Jan. 5. The
results include e-commerce sales and international stores. Costco
shares rose 1.6% Thursday, according to FactSet, and, like shares
of Walmart and Target, are trading near all-time highs.
J.C. Penney's comparable-store sales fell 7.5% during the
nine-week stretch that ended Jan. 4. Excluding appliances and
furniture, categories it exited last year, comparable sales fell
5.3% in the period. The retailer maintained its financial targets
for the fiscal year, which includes January.
Penney's shares, which have hovered around $1 apiece, fell
10.8%.
Chuck Grom, an analyst with Gordon Haskett Research Advisors,
said the continued decline in Penney's sales gives him little hope
the company will be able to turn things around this year.
Kohl's said its comparable sales for November and December
slipped 0.2%, citing weakness in its women's apparel business. It
also warned that profits would be at the low end of its prior
target range. Shares closed down 6.5%.
"We are managing the business with discipline and we expect to
deliver on our earnings guidance for the full year," Chief
Executive Michelle Gass said.
Department stores have been losing ground to other retailers for
decades. At the end of 2019, department stores accounted for 1.2%
of total retail sales, down from 5% in 2005 and 9.5% in 1980,
according to research firm Customer Growth Partners. Despite that
decline, the chains haven't closed stores fast enough, according to
Customer Growth data.
Adidas, Nike and Under Armour brands have become increasingly
important at Penney's and Kohl's in recent years. Those are the
three largest brands in Amazon's apparel and footwear category,
according to Stackline, which monitors online sales.
L Brands said comparable sales, which include sales from
company-owned stores in North America open at least a year and
digital sales, fell 3% for the nine weeks ended Jan. 4.
The company, which also owns Pink and Bath & Body Works,
said it now expects fourth-quarter earnings of $1.85 a share. It
had previously guided for earnings of $2.00 a share. Shares rose
about 4.5%.
Other retailers reporting holiday results included Urban
Outfitters Inc., which posted lackluster sales at its eponymous
brand. Following the news, shares of the company fell 9% in
after-hours trading.
Urban Outfitters, which also owns the Anthropologie and Free
People brands, said comparable retail sales at its namesake stores
fell 1% for the two-month period ended Dec. 31. Anthropologie fared
better with comparable retail sales up 5%.
Write to Suzanne Kapner at Suzanne.Kapner@wsj.com
(END) Dow Jones Newswires
January 10, 2020 02:47 ET (07:47 GMT)
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