Retail Sales Preview: Retailers Get an Easter Treat
Retailers are expected to get a boost from a late Easterwhen they report their monthly sales on Thursday.
The Thomson Reuters Same-Store Sales Index is expected to show an 8.4 percent increase in April, compared with April 2010's 0.7 percent gain.
According to Thomson Reuters, most of theholiday's sales fall in a tight time-period shortly before Easter.
Still, the retail industry is recording some solid sales gains. If you combine April's expected results with the sales already posted in March, the sector's average growth for the period would be an increase of 5 percent. That's stronger than January and February's results, when sales rose 4.5 percent and 4.2 percent, respectively.
This suggests that consumer spending is continuing to gain momentum, despite rising gasoline prices and high levels of unemployment.
While this bodes well for the economy—more than 70 percent of which hinges on consumer spending—there is a caveat. The stores that report monthly sales results, are getting fewer and fewer in number, and are dominated by retailers such as Limited , TJX , and Gap , that rely heavily on apparel sales. And exclude companies such as Wal-Mart Stores , the world's largest retailer, which no longer provide results on a monthly basis.
If the trends from Mastercard Advisor's SpendingPulse survey play out, apparel sales will be strong. The SpendingPulse report measured a 10.4 percent increase in the category last month.
Retail analyst Brian Sozzi suggests that consumers are in the midst of a "replenishment boom,"where they are restocking their closets with items that they held back on buying during the economic downturn.
But that is only part of the total retail picture. Other areas such as electronics and appliance sales showed some weakness in the SpendingPulse report, and that should be watched carefully. Especially as gas prices continue their upward climb past the $4.00 mark in many states.
Here's a rundown of what analysts are expecting from retailers in April, according to Thomson Reuters.
April 2011 Same-Store Sales Estimates
|Retailers||April 2011 Estimates||April 2010 Actuals|
|Kohl's Department Store||15.5%||(7.7%)|
|Dillards Department Store||7.0%||(5.0%)|
|Saks Department Store||10.3%||3.2%|