NEW YORK — June’s same-store sales figures were better than May’s for the most part, according to a report prepared by analyst Thomas H. Tashjian of First Manhattan.
Major retailers will report June sales on Thursday.
After a slow spring, said Tashjian, warmer weather helped release pent-up consumer demand. As a result, many retailers met or exceeded plan in June, with apparel gains often exceeding those for hard goods. The second and third week of June produced the best gains, with some leveling off subsequently.
With retailers holding lower inventories, the June sales pickup will obviate the need for heavy markdowns.
Department stores, according to Tashjian, were among the best performers. Junior specialty chains continued to struggle.
Tashjian expects strong same-store sales to be up 8 percent at J.C. Penney, and to gain 7 percent at Sears, Roebuck & Co. May Department Stores and The Gap should be up 5 percent. He put the Neiman Marcus Group at 5 percent ahead; Dillard Department Stores up 6 percent; Dollar General, 12 percent; Eddie Bauer, 11 percent; Burlington Coat Factory, 7 percent and Wal-Mart Stores, 7.5 percent.
He estimated Dayton Hudson Corp. will show a 4 percent same-store sales gain with the Target division’s 9 percent gain offset by Mervyn’s 2.5 percent decline.
Tashjian is looking for flat same-store sales at Dayton Hudson’s department store division.
Among those Tashjian expects to come in below plan are The Limited, down 1 percent; Kmart, up 2 percent; Catherines up 1.5 percent; Charming Shoppes, up 3 percent; Clothestime, down 11 percent; Deb Shops, up 1 percent; Merry-Go-Round Enterprises, down 17 percent; Wet Seal, down 14 percent, and TJX Cos., down 1 percent with T.J. Maxx coming in flat and Hit or Miss down 5 percent.
Mercantile Stores will show a 2 percent same-store sales gain, Tashjian predicted, noting it’s the first time in three months that the company is on the plus side and slightly above plan. Based on the expected June results, Tashjian raised his second quarter estimate “a few pennies” to 12 cents a share against a loss of 4 cents in the year-ago quarter.
Other upward revisions of second-quarter earnings included Dayton Hudson and Penney’s. Business at DH’s Target division is “exceptional” and while the Mervyn’s division is below plan, promotions are down, he reported. Flat same-store sales at the department store division are on plan. He increased his second-quarter estimate to 50 cents a share from 45 cents, against year-ago earnings of 28 cents.
J.C. Penney’s store sales are expected to be above plan, with the Southwest providing the best pickup. Catalog sales are up 8 percent for the month, although the company planned on 10 to 11 percent gains. Tashjian has increased his estimate for the second quarter by 2 cents a share to 52 cents against 42 cents in last year’s quarter.
He said Clothestime suffered from weakness in the junior apparel market, and cut his quarterly earning estimate almost in half to 8 cents a share from 15 cents, against 25 cents a year ago.
Business at Wet Seal was weak throughout June, Tashjian noted. He added a nickel a share to the expected loss for the second quarter. This brought his estimate down to minus 10 cents against a loss of 3 cents a year earlier.
The weak sales trends at the TJX operating divisions have spurred Tashjian to cut his estimate for the quarter by 4 cents a share to 31 cents against 33 cents last year.