Retailers report positive March sales
Retailers from discounter Target Corp. to depart-store chain Macy's to outdoor sports retailer Zumiez reported better-than-expected sales during the month in the latest sign that Americans are feeling better about the economy. The sales reports come ahead of a government report that's expected will show the fourth straight month of strong hiring.
"Retailers are benefiting from an improving employment and consumer confidence picture," said Ken Perkins, president of Retail Metrics, a research firm.
Only a small group of retailers report monthly figures, which are based on revenue at stores opened at least a year and considered an indicator of a retailer's health. Still, industry watchers say there's a reason to be optimistic because the numbers offer a snapshot of consumer spending, which accounts for more than 70 percent of all economic activity.
Gap Inc., which has been struggling recently, was one of the biggest success stories of the month. Revenue in stores open at least one year rose 8 percent, better than the 5.4 percent rise analysts polled by Thomson Reuters expected. That includes a 9 percent rise at namesake stores, an 11 percent rise at Old Navy and a 5 percent rise at Banana Republic.
"We delivered solid sales performance in March and are pleased with customer response to product across all brands," said CEO Glenn Murphy.
Target and Macy's also posted solid results and raised their forecasts.
Target reported revenue in stores open at last one year rose 7.3 percent, better than the 5.4 percent analysts expected. The company raised its fiscal first quarter guidance based on the strong results.
Macy's reported the revenue figure rose 7.3 percent, beating expectations of a 4.8 percent rise. The company raised its forecast for revenue in stores open at least one year during the combined March and April period, to a 4.3 to 4.5 percent rise, from prior guidance of 3 to 3.5 percent rise.
But not everyone beat expectations. Costco Wholesale Corp.'s revenue at stores open at least a year climbed 6 percent in March, falling short of the 6.7 percent increase analysts expected. Stripping out higher gas prices and the negative impact of foreign currencies, revenue at stores in the U.S. increased 5 percent and climbed 9 percent internationally.
And the teen sector was a weak spot, with both The Buckle and Wet Seal missing analyst expectations.