Q3 2019 U.S. Retail Scorecard – Update November 21, 2019

Eighty percent of companies in our Retail/Restaurant Index have reported Q3 2019 EPS. Of the 166 companies in the index that have reported earnings to date, 69% have reported earnings above analyst expectations, 7% reported earnings in line with analyst expectations and 24% reported earnings below analyst expectations. The Q3 2019 blended earnings growth estimate is 3.9%.

The Q3 2019 blended revenue growth estimate is 5.6%. Fifty-four percent have reported revenue above analyst expectations, and 46% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

Source: I/B/E/S data from Refinitiv

Retail Earnings This Week

Macy’s beat its Q3 earnings estimate, but missed on revenue and SSS. The retailer said sales were hurt by a warmer fall season, soft international tourist sales, weaker than expected performance at lower-tier malls, and temporary e-commerce upgrade. Meanwhile, Target benefited from weather sensitive categories as cooler weather spread, and saw a 31% increase in online sales. Likewise, Ross Stores sales received a boost from higher traffic and an increase in the size of the average basket.  On the flip side, Gap Inc. missed expectations and said it was not pleased with third quarter results and is “aggressively addressing the operational issues that are hindering the performance” of their brands (Source: Gap Q3 Release, 11/21/19).

Here are the same store sales and earnings estimates for retailers reporting earnings this week:

Exhibit 2: Same Store Sales and Earnings Estimates/Results – Week Of Nov 18, 2019

Source: I/B/E/S data from Refinitiv