August 18, 2021

Q2 2021 US Retail Scorecard – Update August 18, 2021

by Jharonne Martis.

Seventy five percent of companies in our Retail/Restaurant Index have reported Q2 2021 EPS. Of the 152 companies in the index that have reported earnings to date, 85% have reported earnings above analyst expectations, 3% matched and 12% reported earnings below analyst expectations. The Q2 2021 blended earnings growth estimate is 148.8%.

The Q2 2021 blended revenue growth estimate is 24.0%. Eighty-four percent have reported revenue above analyst expectations, and 16% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

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

Q2 2021 retail earnings

Target and Lowe’s added significant gains on top of last year’s stellar performance (Exhibit 2). So far, Walmart, Target, Home Depot and Lowe’s have posted stronger Q2 2021 results than their 2019 pre-pandemic levels and 2020 results. Home Depot, Target and Walmart indicated healthy inventory levels going into the back-to-school and Halloween season. They also gave us a glimpse at the upcoming holiday season as consumers are already purchasing Halloween merchandise.

Target’s sales saw a boost from traffic, which was up 13% with strong sales across most categories. Its merchandise and collaborations with brands like Levi’s are resonating well with consumers. Moreover, its new Ulta Beauty partnership arrived just in time, as Target remains a favorite destination for back-to-school. The discounter also posted a 10% rise in digital sales on top of last year’s 195% digital growth, suggesting online business continues to rise.

Meanwhile, Lowe’s faced its most difficult SSS comparison from a year-ago at 34.2%, and beat its SSS estimate with a -1.6% comp. In normal times, a negative comp would be a sign of struggling business. However, considering Lowe’s blockbuster performance last year, it means business volume is holding up well.

Exhibit 2: Revenue and Net Income Results: 2019 2021

Source: Refinitiv I/B/E/S estimates

Here are this week’s Q2 2021 earnings and same store sales expectations:

Exhibit 3: Same Store Sales and Earnings Estimates–Q2 2021

Source: Refinitiv I/B/E/S estimates

Below are this week’s Q2 digital sales growth estimates. Both Target and Walmart beat their estimates with a 10% and 6% Q2 growth in e-commerce, suggesting online spending grew on top of difficult comparisons from a year ago.

Exhibit 4: E-commerce Sales Estimates/Results –Q2 2021

Digital Sales Growth
Ticker Company Name Q2 2021 EST
WMT Walmart Inc 16.3
HD Home Depot Inc 0.0%
TGT Target Corp -0.5%
LOW Lowe’s Companies Inc 0.0%

Source: Refinitiv I/B/E/S


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