Retail stocks rose 2.7 percent Friday, cementing the sector’s seventh-straight week on the rise despite continued concerns about shoppers and sales.
The S&P Retail Index increased 8.90 points to 338.23 for the day and advanced 1.7 percent for the week. The Dow Jones Industrial Average fell 0.7 percent for the week to close at 8,076.29.
The disconnect between weak sales in stores and rallying markets has been sharp and, in part, a sign of just how far retailers have fallen. Despite their 51.5 percent advance since March 6, retail stocks are still down 37.2 percent from their high in February 2007.
With retailers such as Mervyns, Goody’s, Linens-N-Things, Circuit City and Steve & Barry’s part of the retail graveyard, real estate firms are also getting squeezed as they scramble to fill the space.
The percentage of leased space in Developers Diversified Realty’s shopping center portfolio fell to 90.7 percent at the end of the first quarter, down from 95.6 percent a year earlier. The percentage falls to 88.4 percent — a historic low — when the now-vacant Mervyns is factored in.
“The industry as a whole is expected to see more fallout during the first quarter of 2009, and while there are retailers currently facing severely deteriorating operating fundamentals, a significant portion of our core retailers continue to prove their resilience amid the challenging economic climate,” said Daniel Hurwitz, president and chief operating officer of Developers Diversified. Among the concepts most aggressively expanding with the developer are Forever 21, Nordstrom Rack, Ross Dress for Less, T.J. Maxx and Marshalls.
The company’s funds from operations, a key metric for real estate companies, increased 40.9 percent in the first quarter to $150.6 million, driving shares of the company ahead 11.4 percent to $3.90 Friday. The stock gained 24.6 percent for the week.
Among the top retail gainers for the week was Saks Inc., which managed a 40.7 percent boost to $4.98 after a J.P. Morgan upgrade earlier in the week. Destination Maternity Corp. was also on the way up with a 37.5 percent increase to $10.63 after besting second-quarter expectations.
Shares of Target Corp. fell 1.1 percent last week to $40.08 as the company continued to trade barbs with activist investor William Ackman.
On Friday, Ackman sent a letter to Target shareholders inviting them to attend a May 11 town-hall-style meeting with him and the other four people he’s nominated to the retailer’s board. Ackman, who through his Pershing Square fund controls 7.8 percent of Target, has said his proposed directors have more relevant experience in retail, real estate and credit cards than the company’s nominees.
“The deficit of relevant experience on Target’s board has contributed to the company’s underperformance during this recession,” said Ackman.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)