Q3 2020 U.S. Retail Scorecard – Update November 17, 2020

Seventy four percent of companies in our Retail/Restaurant Index have reported Q3 2020 EPS. Of the 152 companies in the index that have reported earnings to date, 89% have reported earnings above analyst expectations and 11% reported earnings below analyst expectations. The Q3 2020 blended earnings growth estimate is -12.5%.

The Q3 2020 blended revenue growth estimate is 3.8%. Seventy-eight percent have reported revenue above analyst expectations, and 22% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

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

Retail earnings this week

Retail sales (+0.3%) posted gains in October for the sixth consecutive month. However, this is below expectations of +0.5% month-to-month, according to Refinitiv IFR data. Online sales (+3.1%) saw the strongest gain in October, boosted by an earlier-than-usual holiday discount season and Amazon Prime Day. Consumers took advantage of the promotions to purchase electronics and appliances (+1.2%). Building materials and garden equipment was also up (+0.9%). The weakest October sectors include department stores (-4.6%), clothing (-4.2%), and sporting goods (-4.2%). Although these were the weakest sectors for the month of October, sporting goods was still significantly up from a year-ago (+12.4%), before the pandemic.

Online sales also soared at Walmart and Home Depot, helping smash their Q3 earnings and Same Store Sales estimates. Both companies suggest that this trend will remain permanent. Home Depot saw an 80% spike in digital sales, with customers picking up about 60% of their orders in-store.

Exhibit 2: Earnings and Same Store Sales Estimates/Results – Q3 2020

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