As Black Friday looms, one analyst said he expects the holiday shopping kickoff to be "good, not great."
Scott Tuhy, senior credit officer at Moody's, told CNBC's "Squawk on the Street" that he's concerned about the level of inventory he's seeing in the apparel channel.
"I think it's going to be a great time to be a consumer but I'm not sure that's going to be so great for earnings, particularly in the apparel space," he said Wednesday.
But Tuhy added that there could be some pockets of strength in the off-price channel.
"These companies can really benefit from the inventory overhangs that we've seen and the value that they offer consumers," he said.
Another one of retail's big winners could be J.C. Penney, said Tuhy. In fact, he told CNBC that Penney is the only department store that Moody's has a positive rating for.
"I think Penney's is much better positioned this holiday season than they were last year," Tuhy said. "Their home business is now back to sort of what their traditional customer is expecting to see. They had one of the better comps out in Q3 so I think they've got that core customer back."
Tuhy added that one of the businesses that's done great things for the retailer is Sephora.
"I think particularly as a gift-giving occasion, that positions J.C. Penney's well," he said, adding that the department store could benefit from Macy's and Nordstrom's recent slump.
Piper Jaffray senior research analyst Erinn Murphy said Nike is another retailer that could do well in the holidays into the next year. While there isn't much innovation happening in the apparel space, Murphy said that looking at athletic brands like Nike is a way to play that insufficiency.
Murphy added that traditional brick-and-mortar retailers are not only facing a lack of innovation but could also face challenges from ecommerce and online sales.
In its latest survey of 1,000 domestic consumers, Piper Jaffray found that 34 percent of consumers are opting to spend online rather than in-store for the holidays, a trend Murphy says is structural and "here to stay."
In fact, the Piper Jaffray survey showed that 14 percent of consumers have already completed their holiday shopping at a lower expense threshold versus last year and that spending intentions have decelerated.
"You are seeing a lot more traffic that's being spread over the weekend versus right upfront with the doorbusters, you know kicking down at 6 p.m. tomorrow night," Murphy said.
Despite a muted holiday shopping outlook, Tuhy thinks there could be potentially positive tailwinds coming into the new year.
"One of the big things that will happen in 2016 is we have an easy comparison in the first half compared to the first half of 2015," he said, citing the 2015 West Coast port strikes.