February Retail Sales: Not So Gray After All

Some of the weaker spots included women's apparel and department stores. On Wednesday, SpendingPulse, which tracks sales in the MasterCard payments network and couples it with estimates for all other payment forms, said sales at U.S. specialty apparel chains rose 1.9 percent in February, down from a 5.4 percent rise in January and a 2.5 percent gain in February 2007.

February overall was a very flat month in terms of year-over-year growth across a whole variety of sectors," said Michael McNamara, SpendingPulse's vice president of research and analysis. "Nothing really outperformed," he added, citing retail categories such as electronics, appliances, shoes, home decor and luxury goods.

Gap, Wet Seal and Zumiez were among those specialty stores posting disappointing results.

Same-store sales fell 6 percent at the Gap . The company cited weak traffic for the poor sales, which were worse than analyst had expected.

Notably, teen apparel retailer Abercrombie & Fitch fell short of expectations. The company, which operates its namesake stores as well as Hollister, said its same-store sales fell 2 percent in February, compared with estimates of flat sales for the month.

Analysts are watching teen retailers closely as these stores have remained resilient over the past few months of weak sales. While the poor results at Abercrombie were not an encouraging sign, other teen apparel retailers remained strong.

Pacific Sunwear of California for example, said same-store sales rose a better-than-expected 6 percent and Aeropostale rose a better-than-expected 7 percent.

Upscale retailers also are showing some cracks. Nordstrom said its February sales fell 5.8 percent, a much steeper decline than the 3.5 percent predicted by analysts.

J.C. Penney same-store sales fell 6.7 percent and forecast another decline in March. On average, analysts were expecting the retailer's sales to fall 1.9 percent.

Still, some specialty retailers did manage to outperform lackluster expectations in February.

Among them was Limited Brands and Ann Taylor , which both posted a narrower decline in sales than analysts had been expecting.

Limited said its same-store sales fell 9 percent, while AnnTaylor saw its sales drop 1.7 percent.

"Our results in the month of February reflected continued soft traffic trends in our business, albeit improved versus last month," Ann Taylor Chief Executive Kay Krill said in a news release.

March Matters

Even with the rosier than expected results in February, the consumer has slowed their spending and there will be challenges ahead.

"Overall, the results right now show the slowing of the consumer," Telsey said. "The first quarter will be challenging. Early Easters are typically never that great for the retailers, and Easter's on March 23rd this year."

According to Telsey after the month of January, February is one of the smallest months in terms of sales for retailers.

"We really need to look to March," she said. According to Telsey, when retailers are going up against tough comparisons.

Macy's, Others End Monthly Reports

With all the reports coming out from retailers on Thursday, department-store chain Macy's won't be among them. Macy's recently decided to end the practice of issuing monthly sales reports. Its decision comes as many retailers face an increasingly difficult environment that is pressuring stock prices. Shares of Macy's are down more than 40 percent in the past year.

Macy's joins Sears Holdings , Home Depot , CVS Caremark and Jos. A. Bank Clothiers in eliminating monthly same-store sales updates.

-- Reuters and Associated Press contributed to this report

© 2011 CNBC.com

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