Q1 2020 U.S. Retail Scorecard Update – May 22, 2020

Seventy four percent of companies in our Retail/Restaurant Index have reported Q1 2020 EPS. Of the 156 companies in the index that have reported earnings to date, 57% have reported earnings above analyst expectations, 2% reported earnings in line with analyst expectations and 41% reported earnings below analyst expectations. The Q1 2020 blended earnings growth estimate is -38.2%.

The Q1 2020 blended revenue growth estimate is 0.9%. Fifty seven percent have reported revenue above analyst expectations, and 43% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

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

Retail Earnings This Week

As the coronavirus outbreak heightened, more retailers withdrew earnings guidance. As stores have already reopened in Asia, Nike and other retailers have informed us that store traffic is at the same levels seen prior to the COVID-19 outbreak. Despite this, shoppers don’t feel comfortable buying in stores and are going online to finalize their purchase. If it wasn’t clear pre-pandemic, the importance of a “solid” omnichannel experience is no longer debatable, especially as shoppers gravitate online and use mobile devices for curbside pickup and deliveries.

This week, Best Buy said Q1 online sales grew 154.4% over last year, and most of the orders were for deliveries and for curbside pickup, thus underlining the importance of an omnichannel experience going forward. This is a necessity for retailers to succeed. However, the bulk of retailers have not mastered this, putting them at a disadvantage during COVID-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 May 18, 2020

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