Bloomberg’s Richard Yamarone puts out some fantastic economic information and assesses the situation from the top down. In the recent daily edition of Bloomberg Briefs, there was a section taken from the Orange Book.
He comments that: The quarter is drawing to an end and the comments have reflected a more cautious stance, particularly with respect to uncertainties surrounding tax policies scheduled to take effect in the new year. Many retailers talked about an extremely promotional holiday season, which is traditionally a sign of weaker economic conditions. Upbeat news from the construction sector is expected as reconstruction efforts from Hurricane Sandy commence.
Williams-Sonoma [WSM] Earnings
Call 11/14/12: “[I]t‘s very promotional out there, and it might get more so as we move further into the season. We‘ve said all year along that we are ready to be promotional and we have a plan to be competitive. Competitive pricing is a key part of our strategy. We know the customer expects, responds to promotions and we don‘t think this is going to change.”
Wal-Mart [WMT] Earnings Call 11/15/12:
“While we are optimistic about sales, we are also realistic. Current macroeconomic conditions continue to pressure our customers. The holiday season is predicted to be very competitive, but we are very well prepared to deliver on the value and low prices our customers expect.”
TJX Companies [TJX] Earnings Call 11/13/12:
“We‘ve been achieving tremendous results for the last several years against the backdrop of a difficult economy and the growth of online retailing.”
Target [TGT] Earnings Call 11/15/12:
“[G]uest feedback corresponds to overall consumer sentiment data showing that while consumers have increased confidence about their near-term prospects and personal finances, they have a high level of uncertainty about the longer term health of the economy and intend to continue saving and paying down debt. For the holiday season, consumers anticipate spending slightly more than last year, but indicate they‘ll be focused on value, pricing and promotions.”
Staples [SPLS] Earnings Call 11/14/12:
“I think going over any kind of cliff is not good news. And I think that‘s true of the fiscal cliff as well. I mean we think the economy in the U.S. is pretty sluggish for small and medium-size businesses now and hiring has been very slow for those companies as they consider things like the cost of ObamaCare and uncertainty around this whole fiscal cliff thing.”
Saks [SKS] Earnings Call 11/13/12:
“Our customer, we‘ve said for a long time, is very much driven by how do they feel about their net worth and what are they feeling about where the markets are. There‘s a little bit of volatility in the markets today. People concerned about what‘s going on with the U.S. economy, the fiscal cliff, what‘s happening in Europe, where are things going? The markets are still holding up reasonably well.”
Home Depot [HD] Earnings Call 11/13/12:
“[W]e believe the U.S. is still working through the issues associated with the housing crisis. Credit availability remains a major issue, but we can start to see the housing market as an assist to our growth rather than an anchor.”
Dollar Tree Inc. [DLTR] Earnings Call
11/15/12: “[T]he macro environment really hasn‘t improved. So, it‘s stubborn, it continues and there is uncertainty and doubt out there. Prove it; I can‘t prove it for you. I can just tell you what I see and what we hear and what we listen to our customers and what they say.”
Abercrombie & Fitch [ANF] Earnings Call 11/14/12:
“The four quarters through the second quarter of this year were challenging, reflecting the combined impact of a dramatic spike in commodity costs, a sharp deterioration in the macroeconomic environment in Europe and ending up on the wrong side of some merchandise planning decisions we made in the middle of 2011.”
Applied Materials [AMAT] Earnings Call 11/15/12:
“Soft macroeconomic conditions combined with the timing of Windows 8 resulted in subdued back-to-school PC sales, and we expect negative PC growth for the calendar year. As a result, we are tempering our expectations for logic spending in 2013.”
