May 18, 2021

Q1 2021 U.S. Retail Scorecard – Update May 18, 2021

by Jharonne Martis.

Seventy percent of companies in our Retail/Restaurant Index have reported Q1 2021 EPS. Of the 143 companies in the index that have reported earnings to date, 86% have reported earnings above analyst expectations, 3% matched and 11% reported earnings below analyst expectations. The Q1 2021 blended earnings growth estimate is 103.8%.

The Q1 2021 blended revenue growth estimate is 13.7%. Seventy-one percent have reported revenue above analyst expectations, and 29% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

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

Q1 2021 E-commerce sales – least disruptive measure

This Q1 earnings season is unusual because it marks the one-year anniversary of stay-at-home orders due to the pandemic. Because of store closures, consumers were forced to go online to make purchases. As a result, “online sales” is one of the least disruptive measures. This will be the first year where e-commerce sales results will be telling if the flight to online spending looks to become permanent or is fading.

Today, Walmart beat its 17.5% E-commerce estimate, with a robust 37% Q1 2021 E-commerce growth (See table below). Home Depot also saw digital growth of 28%, on top of difficult comparisons from a year-ago. Similarly, Target is expected to post a 4.3% digital comparable sales growth for Q1 2021 vs. an impressive 141% in Q1 2020. This suggest that these retailers continue to gain market share on top of last year’s impressive digital growth.

Exhibit 2: Retailers Reporting Q1 2021 E-commerce Sales

Source: Refinitiv I/B/E/S

Today, the government posted a record $215.0 billion in Q1 2021 retail e-commerce sales, a 39.1% increase from Q1 2020. Accordingly, Refinitiv IFR estimates show continued double-digit e-commerce growth over the next four quarters.

Q1 2021 retail earnings

Meanwhile, Target, Lowe’s and L Brands are on track to post robust Same Store Sales on top of difficult comparisons last year. Target’s EPS is expected to be stronger than pandemic 2020 and pre-pandemic 2019 levels. For Q1, the StarMine Predicted Surprise shows investors can expect positive surprises from Target’s earnings tomorrow.

Likewise, Lowe’s currently has an EPS mean forecast of $2.62 a share. However, the StarMine data shows that there’s a five-star rated analyst with a very accurate rating that published a Bold Estimate, which is different (in this case higher) than the consensus estimate. The analyst expects Lowe’s to report earnings of $2.86 a share and beat both its EPS and revenue estimates.

Exhibit 3: Retailers Reporting Q1 2021 Same Store Sales and Earnings

Source: Refinitiv I/B/E/S



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