In addition to cost inflation, supply-chain problems tripped up the nation’s largest retailers, as did tough comparisons to last year, when federal subsidies gave consumers free money to spend. Inflation may have helped the retailers’ top lines, but it also meant higher-than-expected expenses and lower-than-expected margins. 5).Īs we were reminded by Target and Walmart earnings reports this week, rising sales are no guarantee of rising earnings. Here’s the y/y nominal sales performance of the 13 retail sales categories in April: gasoline service stations (36.9%), food services & drinking places (19.8), miscellaneous store retailers (18.6), nonstore retailers (12.7), clothing & accessories stores (8.0), food & beverage stores (7.1), health & personal care stores (2.1), building materials & garden equipment (1.7), general merchandise stores (1.2), furniture & home furnishings stores (0.8), motor vehicles & parts (-1.7), electronics & appliance stores (-5.2), and sporting goods, hobby book & music stores (-5.4) ( Fig. Real retail sales still increased by 0.6% m/m in April, though they were flat y/y ( Fig. It’s an impressive pace of consumption even after adjusting for the 8.3% y/y CPI increase in April. The spending spree lifted April retail sales by 0.9% m/m and 8.2% y/y ( Fig. But we also learned that retailers’ profit margins were squeezed during Q1.Ĭonsumers shopped online when they were shut in at home due to Covid, and now, armed with boosters, they’re shopping in person. This week, we learned that consumers are still spending.
Consumers may continue to shop until they drop, but stocks dropped yesterday on disappointing results from a couple of giant retailers. … Also: A look at Walmart’s foray into fintech.Ĭonsumer Discretionary: The Spending Continues. Within Materials, we focus on one industry with a shiny outlook, Steel, and a single member, Nucor. … Also: With recession fears running high among investors, why is the S&P 500 Materials sector in their good graces? It has outperformed the market and most other sectors ytd. Jackie recaps what their management teams had to say about the quarter. Now the bad news: Two retail giants missed their Q1 earnings marks, causing recession-fearing investors to jettison their stocks. Check out the accompanying pdf and chart collection.Įxecutive Summary: First the good news: Retail sales rose solidly in both March and April.
0 kommentar(er)
