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Retail Sales Up: Holiday Season to Kick Off on a High Note
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After the news of an uptick in the U.S. consumer sentiment to 13-year high, retailers got another reason to smile just ahead of the festive season. U.S. retail sales rebounded sharply in September, after a pullback in the month of August, on sturdy auto sales, rising gasoline prices and increased demand for building materials. This clearly indicates that the economy is gathering pace and setting the stage right for an upbeat holiday season.
Analysts believe that a buoyant stock market, gradual wage acceleration, fall in the unemployment rate to a 16-year low, and a lift in economic activity post hurricanes were enough to boost consumer sentiment. According to the data released by University of Michigan, consumer sentiment index surged to 101.1 in October from 95.1 in September. All this is music to retailers' ears as they try to make the most of the season, which accounts for a sizeable chunk of yearly revenues and profits.
Sturdy Retail Sales
The Commerce Department stated that U.S. retail and food services sales in September increased 1.6% to $483.9 billion, following a revised reading of a 0.1% decline registered in August. However, retail sales increased 4.4% from September 2016. The report suggests that sales at motor vehicles and parts dealers rose 3.6%, while receipts at gasoline stations and sales at building material dealers jumped 5.8% and 2.1%, respectively.
Sales at electronics & appliance stores dipped 1.1%, while at clothing shops the same rose 0.4%. Meanwhile, food & beverage stores and general merchandise shops witnessed sales growth of 0.8% and 0.3%, respectively. Sales at non-store retailers climbed 0.5% and increased 9.2% from the prior-year period.
Holiday Season: A Likely Bonanza for Retailers
With September retail sales reaching a pinnacle after March 2015, hopes have been raised for a blissful holiday season. With the ability and willingness seen in consumers to spend more, retailers could hear cash registers jingle this time. Retailers such as Amazon.com, Inc. (AMZN - Free Report) , Wal-Mart Stores, Inc. (WMT - Free Report) , Macy’s, Inc. (M - Free Report) , J. C. Penney Company, Inc. , Target Corporation (TGT - Free Report) and The Gap, Inc. (GPS - Free Report) are bracing up for the upcoming holiday season.
Be it early-hour store openings, huge discounts, promotional strategies, price matching and free shipping on online purchases, retailers will go the extra mile. Since Christmas is falling on Monday and 32 days after Thanksgiving, shoppers are getting one extra day than last year and an extended weekend for last-minute purchasing.
Data compiled by the nation's largest retail trade group, National Retail Federation projects a 3.6-4% rise in November and December sales (excluding autos, gas and restaurant sales) to $678.75-$682 billion, up from $655.8 billion last year and better than the five-year average sales growth of 3.5%. According to Deloitte, sales during the holiday season are likely to increase in the band of 4-4.5%, while e-commerce sales are envisioned to improve 18-21%.
Wrapping Up
The holiday season is nothing less than a battlefield for the retailers fighting hard to win over consumers and with technology playing a major role they are fast adopting the omni-channel mantra.
With the advent of the holiday season, the retail sector hogs all the attention. So, how about betting your bucks on these lucrative options? Out of the stocks mentioned above, Wal-Mart, Target and Gap carry a Zacks Rank #2 (Buy), while Macy’s has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure.
Image: Bigstock
Retail Sales Up: Holiday Season to Kick Off on a High Note
After the news of an uptick in the U.S. consumer sentiment to 13-year high, retailers got another reason to smile just ahead of the festive season. U.S. retail sales rebounded sharply in September, after a pullback in the month of August, on sturdy auto sales, rising gasoline prices and increased demand for building materials. This clearly indicates that the economy is gathering pace and setting the stage right for an upbeat holiday season.
Analysts believe that a buoyant stock market, gradual wage acceleration, fall in the unemployment rate to a 16-year low, and a lift in economic activity post hurricanes were enough to boost consumer sentiment. According to the data released by University of Michigan, consumer sentiment index surged to 101.1 in October from 95.1 in September. All this is music to retailers' ears as they try to make the most of the season, which accounts for a sizeable chunk of yearly revenues and profits.
Sturdy Retail Sales
The Commerce Department stated that U.S. retail and food services sales in September increased 1.6% to $483.9 billion, following a revised reading of a 0.1% decline registered in August. However, retail sales increased 4.4% from September 2016. The report suggests that sales at motor vehicles and parts dealers rose 3.6%, while receipts at gasoline stations and sales at building material dealers jumped 5.8% and 2.1%, respectively.
Sales at electronics & appliance stores dipped 1.1%, while at clothing shops the same rose 0.4%. Meanwhile, food & beverage stores and general merchandise shops witnessed sales growth of 0.8% and 0.3%, respectively. Sales at non-store retailers climbed 0.5% and increased 9.2% from the prior-year period.
Holiday Season: A Likely Bonanza for Retailers
With September retail sales reaching a pinnacle after March 2015, hopes have been raised for a blissful holiday season. With the ability and willingness seen in consumers to spend more, retailers could hear cash registers jingle this time. Retailers such as Amazon.com, Inc. (AMZN - Free Report) , Wal-Mart Stores, Inc. (WMT - Free Report) , Macy’s, Inc. (M - Free Report) , J. C. Penney Company, Inc. , Target Corporation (TGT - Free Report) and The Gap, Inc. (GPS - Free Report) are bracing up for the upcoming holiday season.
Be it early-hour store openings, huge discounts, promotional strategies, price matching and free shipping on online purchases, retailers will go the extra mile. Since Christmas is falling on Monday and 32 days after Thanksgiving, shoppers are getting one extra day than last year and an extended weekend for last-minute purchasing.
Data compiled by the nation's largest retail trade group, National Retail Federation projects a 3.6-4% rise in November and December sales (excluding autos, gas and restaurant sales) to $678.75-$682 billion, up from $655.8 billion last year and better than the five-year average sales growth of 3.5%. According to Deloitte, sales during the holiday season are likely to increase in the band of 4-4.5%, while e-commerce sales are envisioned to improve 18-21%.
Wrapping Up
The holiday season is nothing less than a battlefield for the retailers fighting hard to win over consumers and with technology playing a major role they are fast adopting the omni-channel mantra.
With the advent of the holiday season, the retail sector hogs all the attention. So, how about betting your bucks on these lucrative options? Out of the stocks mentioned above, Wal-Mart, Target and Gap carry a Zacks Rank #2 (Buy), while Macy’s has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure.
See these buy recommendations now >>