Retailers are turning in surprisingly strong monthly sales reports in August, as sales-tax-free holidays and discounting coaxed shoppers to open their wallets and stock up on back-to-school items.
Overall, the Thomson Reuters Same-Store Sales Index is expected to rise 2.5 percent in August, the research firm said.
The majority of the retailers reporting monthly sales results have topped analysts’ estimates, according to Thomson Reuters.
One of the best performances came from Limited
[LTD 24.27 --- UNCH (0) 
] , which posted a 10 percent increase in same-store sales, far better than the 7.3 percent increase analysts had projected.
Teen retailers were expected to struggle, and that was reflected in the results from Hot Topic [HOTT 5.27 --- UNCH (0) ] and The Buckle [BKE 24.37 --- UNCH (0) ] . Hot Topic missed estimates with same-store sales falling 3.7 percent, while The Buckle’s sales fell 3.5 percent. The companies were forecast to post sales declines of 6.2 percent and 6.5 percent, respectively.
Consumers remain cautious about spending as unemployment remains high and questions about the economy persist. The real test for retailers will come in September. That is when investors will see if consumers are truly picking up their spending or if back-to-school sales merely shifted to August from September.
On Wednesday, MasterCard’s SpendingPulse report showed an uptick in total retail spending in August, but shoppers stuck to the basics and spent on essentials such as children’s clothing. Sales in other categories, including women’s and men’s apparel and luxury goods, fell, the report said.
More than one-third of the states held sales tax holidays in August, including three large states that did not have this kind of event last year.
Retailers are likely hoping that the fall brings more clarity about the economy and an improved employment picture. Meanwhile, investors will be looking at August sales for the lessons they may teach about the upcoming Christmas holiday season.
One thing that isn’t up for debate: the bar will be raised in the months ahead as retailers will be facing much tougher comparisons with their year-ago performance beginning in September.
August 2010 Same-Store Sales
| Retailers | August 2010 Estimates | August 2010 Actuals |
| Costco Wholesale (excluding gas) | 3.6% | 5% |
| BJ Wholesale (excluding gas) | 2.4% | 1.9% |
| Target | 2.0% | 1.8% |
| JC Penney | 1.6% | 2.3% |
| Kohl’s Department Store | 2.6% | 4.5% |
| Dillards Department Store | (0.5%) | Breakeven |
| JW Nordstrom | 5.9% | 6.3% |
| Saks Department Store | 4.3% | 1% |
| Stage Stores | 1.3% | 0.5% |
| Macy’s | 4.0% | 4.3% |
| Gap | (0.2%) | Breakeven |
| TJX | 2.4% | 2% |
| Limited | 7.3% | 10% |
| Ross Stores | 2.9% | 5% |
| Stein Mart | Breakeven | 8.5% |
| Abercrombie | 5.9% | 6% |
| American Eagle | 1.1% | 1% |
| Aeropostale | 1.2% | (1%) |
| Hot Topic | (6.2%) | (3.7%) |
| Wet Seal | (3.5%) | 1.1% |
| The Buckle | (6.5%) | (3.5%) |
| Zumiez | 7.7% | 9.1% |
| Walgreen | 2.4% | |
| Rite Aid | (1.0%) | (1.0%) |
Source: CNBC
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