JP MORGAN: First Quarter Retail Sales Are Looking Strong, Even On Tough Comparisons

Victoria's Secret Model Alessandra AmbrosioLimited Brands, owner of Victoria’s Secret, will announce February same-store sales on March 1.

Photo: AP

US chain stores are just a few short days away from releasing their February same-store sales results.  But early indications, including a number of strong early month-to-date tallies at Limited Brands and TJX, point to a strong first quarter.J.P. Morgan’s Brian Tunick expects two to three per cent growth over the previous month.  Even with tough comparisons even from a year ago, February sales are expected to have improved some 4 per cent, and results this year compare to an 11 per cent improvement since February 2010.

“Looking further into [the first quarter], March will be the toughest two-year comp of 13 per cent, with April facing an 11 per cent comp stack,” Tunick says. “So overall, tough first quarter compares, but retailers are optimistic that the combination of the warm weather and earlier Easter will be supportive of strong sales.” 

Shares in a number of retailers have rallied, with the specialty retail group tracked by J.P. Morgan up seven per cent, to the S&P’s four per cent gain over the past 30 days. 

 Below are Wall Street’s consensus estimates for February same-store sales for a few stores: 

  • Buckle (BKE): February ’12 S/S Up 6.3 per cent
  • Gap (GPS): February ’12 S/S Down 1.3 per cent
  • Limited Brads (LTD): February ’12 S/S Up 3.3 per cent
  • Ross Stores (ROST): February ’12 S/S Up 2.9 per cent
  • TJX (TJX): February ’12 S/S Up 2.8 per cent
  • Wet Seal (WTSLA): February ’12 S/S Down 8.0 per cent

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