Wal-Mart Stores Sales Rise, But Below Expectations
Wal-Mart stores says U.S. same-store sales rose 1.4 percent in March as consumers continued to hunt for bargains and bought necessities, such as groceries. But the results are below Wall Street expectations.
Analysts polled by Thomson Reuters expected the world's largest retailer to post a larger 3.2 percent gain in same-store sales, or sales at stores open at least one year.
Same-store sales rose 0.6 percent at the company's U.S. namesake stores and 6.2 percent at its Sam's Club warehouses during the five weeks ended April 3. Including fuel, same-store sales rose 0.7 percent.
The Bentonville, Arkansas based retailer says first-quarter earnings will be at the high end of its outlook provided in February of earnings between 72 cents and 77 cents per share.
Total sales rose 2.6 percent from the year-ago period to $23.75 billion.
But the world's largest retailer said it expects strong Easter holiday shopping to help it reach its goals for the full quarter.
"Based on the initial strength of our sales this week, we expect Easter to drive April sales performance," Eduardo Castro-Wright, vice chairman of Wal-Mart, said in a statement.
And discount retailer Target says same-store sales declined 6.3 percent in March, slightly better than Wall Street expectations.
Analysts polled by Thomson Reuters expected a 7.4 percent decline in same-store sales, or sales at stores open at least one year.
Total sales for the five weeks ended April 4 fell 2.3 percent to $5.5 million from $5.7 million last year. The company says same-store sales fell 5.3 percent year-to-date, while total sales have declined 1.3 percent, or $9.9 million, so far this year.
Target Chief Executive Gregg Steinhafel said in a statement Thursday that shoppers are still cautious, but that operating results are improving in its business segments. Target expects April same-store sales to be flat from last year.
Earlier, Costco Wholesale reported comparable March sales that were worse than analysts expected Thursday.
Sales at stores open at least a year for the five weeks ended April 5 fell 5 percent. On average analysts expected that same-store sales fell 1.7 percent last month, according to Reuters.
Total sales fell 3 percent from the year-ago period to $6.39 billion.
Costco also said an additional day of sales for the period compared with 2008 boosted net and comparable sales by 1 to 2 percent.
Among other companies reporting, Macy's same-store sales fell 9.2 percent in March, in line with expectations of a drop of 9.3 percent from analysts surveyed by Thomson Reuters. Total sales were of $1.931 billion for the five weeks ended April 4, 2009, a decrease of 9.8 percent compared with the five weeks ended April 5, 2008.
JC Penney and Kohl's all reported same-store sales drops that were smaller than analysts expected. However, Saks same-store sales dropped 23.6 percent, worse than expectations.
Same store sales of Abercrombie & Fitch tanked 34 percent in March, worse than expectations for a 24 percent slump. Net sales over the five-week period ended on April 4 were 29 percent down from the year-ago period to $235.1 million, the company said in a statement.
And Limited Brands reported a 9 percent drop in same-store sales for March, better than the Thomson Reuters consensus estimate of a drop of 12 percent.
According to Thomson Reuters, analysts on average are expecting overall sales in March to be down 1 percent.
Apparel chains that cater to teenagers, such as Buckle and Hot Topic posted stronger-than-expected results.
Hot Topic reported a 7.1
percent rise in March sales, beating the analysts' average estimate for a 5.4 percent increase, according to Thomson Reuters.
Independent retail analyst Jennifer Black said she was not surprised by Hot Topic's results, calling the company "one of the few retailers who are out on top," despite reporting declines in certain merchandise categories due to the Easter shift.
Gap beat analysts predictions, helped by better results from its Old Navy chain, which it has been trying to turn around. Same-stores sales fell 8 percent, while analysts predicted a 9.9 percent drop.
Groceries, health products and accessories remain the most popular sellers, as consumers continue to shop cautiously amid massive job cuts and tight credit.
Mall-based stores, many of which have been struggling, showed some improvement in March.