Big week for retail. Home Depot Inc. (HD) - Get Report , Macy's Inc. (M) - Get Report , Walmart Inc. (WMT) - Get Report , J.C. Penney Co. (JCP) - Get Report and Nordstrom Inc. (JWN) - Get Report all reported, with surprising wins and misses.
Which are the winners and losers? TheStreet reports.
Macy's surprised investors with a strong earnings report and upgraded 2018 guidance. Same-store sales jumped 3.9% on an owned basis vs. expectations of up 0.7% and the company reported first-quarter adjusted earnings of 42 cents a share, beating analysts' consensus of 37 cents, and 26 cents from the same period last year.
Fresh from a coup over Amazon.com Inc. (AMZN) - Get Report , Walmart reported stronger-than-expected earnings for the three months ending in April, which came in at $1.14 per share, 2 cents ahead of the consensus forecast. Group revenues were $121.63 billion, up 4.4% from the same period last year and again topping the Street forecast of $120.5 billion. Walmart also reported that e-commerce sales were up 33%, although the division is still unprofitable.
The giant retailer upped its commitment to e-commerce big time this quarter when it agreed to buy a majority stake in in the Indian e-commerce major player Flipkart Online Services Pvt. Ltd. for $16 billion, beating out Amazon, which had offered an 11th-hour breakup fee of $2 billion to lure Flipkart.
Home Depot posted stronger-than-expected first-quarter earnings despite a hit to same-store sales, which it attributed to colder winter temperatures in the key spring period. The home repair chain's earnings came in at $2.08 per share, topping the Street consensus of $2.05 and rising 24.6% from the same period last year. Group revenues rose 4.4% to $24.9 billion, narrowly missing the consensus forecast of $25.16 billion as same-store sales grew 4.2%. The Atlanta, Ga.-based retailer also confirmed its full-year sales guidance of 6.7% growth and a comparable same-store sales growth rate of 5%.
J.C. Penney missed analysts earnings estimates: actual was $2.58 billion v. $2.61 billion expected. Comparable-store sales are estimated to have risen between 0% and 2% in fiscal 2018. The company blamed the weather for weaker performance, but that's not a valid excuse, said Neil Saunders, managing director of GlobalRetail Data, arguing that it instead reflected the merchandiser's poor inventory mix.
The high-end retailer Nordstrom disappointed investors on Thursday, May 17, with a miss on same-store sales, coming in with an increase of only 0.6% versus a 1% estimate. Following the release, the stock nosedived more than 6%. On Friday, its stock was down another 5% to $45.83.
Other disappointments in the first quarter ended May 5, 2018 included a dip in the growth of online sales, up 18% this quarter, compared with 25% for the comparable year-earlier period. Also taking a hit were gross profits as a percentage of net sales, which were 34.1%, down 21 basis points from the same period last year.
Yet Saunders was upbeat about the retailer, noting that in investing in its stores and online ventures, Nordstrom is shoring up its future.
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