NEW YORK — Thanks to colorful fashion, retailers are expected to post robust April comparable-store sales gains this today.
Analysts said retailers — particularly in the specialty and department store channels — are benefiting from a positive consumer response to merchandise sets that are chock full of color. Companies also face easier year-over-year sales comparisons.
But Easter’s shift to March this year along with cooler temperatures in April may drag results, which is why analysts are offering April same-store sales estimates for specialty, department and mass retailers that call for average comp gains between 4.5 to 8.7 percent.
In turn, WWD’s Consensus Comp Estimate is pegged to show a gain of 5.8 percent for April. For March, the average year-over-year percent change for the retailers tracked by WWD came in with a gain of 8.2 percent.
Still, there is a lot of momentum at retail. According to recent data from the Bureau of Economic Analysis, an agency of the U.S. Department of Commerce, consumer expenditures on apparel and fashion footwear jumped 7.3 percent to $326.9 billion in the first quarter of this year from $304.8 percent in the same period last year.
Goldman Sachs analysts Adrianne Shapira and George Strachan said in a research note this week that the “spring sales momentum has continued” in April. They expect a “slight easing” in same-store sales due to the Easter calendar shift as well as cooler weather during the month.
Brian J. Tunick, equity analyst with J.P. Morgan, said in his research note that business has been “aided by strong, full-price selling driven by what appears to be a new fashion cycle.” As a result, he expects April comps, “while not as robust as March, will certainly not disappoint.”
Deborah Weinswig, equity analyst at Smith Barney, said April’s apparel retailing was all about color. “Key trends for spring are bright colors, pink and yellow, ‘preppy’ looks, status-luxury items, and anything with logos,” she said in her research note. “In addition, we remain encouraged by the reemergence of higher ticket career wear for both men and women and believe that this trend should help to boost the average transaction size, with the department stores the biggest beneficiaries.”
Kimberly Greenberger, equity analyst at Lehman Brothers, said she has been impressed with what she sees at retail. “While color stories remain bright, the contrast [between spring and summer floor sets] is not as noticeable given that spring’s colors were also vivid.”
Greenberger said she believes specialty retailers such as Ann Taylor Loft, Bebe Stores, Hollister, and Banana Republic, among others, have “the strongest assortments” this spring.
— Ross Tucker and Arthur Zaczkiewicz