Eye-on-Retail Tipsheet 11/14/12

Home Depot 3Q results edge up, beat Street’s view by Mae Anderson in AP.  “Blake’s statement signaled a “stronger tone” on the housing market than in prior quarters, said NBG Productions analyst Brian S. Sozzi, who called the remarks encouraging.”  https://www.google.com/hostednews/ap/article/ALeqM5h5wqndoxklbLIiQhqZaE6NLqJ6Ng?docId=4a922de3266b404ea8ce2fcf2b7096a8


Digging deeper into the Home Depot earnings call….  

Pro business

Frank Blake: “Larger Pro’s doing better than smaller Pro’s.”

Carol Tome: “But only 13% of Pro sales are with larger Pro’s.”

Housing recovery

Blake: “So the positive comp in this quarter..combined with every quarter this year..and strength in the core of the business..we’re not lighting rockets over this and we don’t want to get out over our ski’s..but we’re starting to see the recovery of the housing market.”


Blake:  “After several years of effort, we concluded that we could not make our big box retail model profitable there.”

Holiday sales 

Tome:  “Don’t forget that last Dec. we had a positive comp in the US of 7.1% so we’d better have a good holiday to comp that.”

Departments that comped

Craig Menear: “Dept’s that outperformed the company avg. comp were:  lumber, decor, paint, kitchen, outdoor garden, indoor garden, lighting, bath, electrical, hardware and flooring.”

Menear:  “Extra fall event and great weather drove double digit comps in: walk behind mowers, riding mowers, pressure washers, exterior stains and chemicals”

Avg. ticket

Craig Menear responding to a question regarding under $50 transactions being flat:  “When we look at transactions under $50, there are an awful lot of those that fall into a few categories…we’re very pleased how we did in outside garden..but when you look at what has happened in some categories…the average unit retail growth, for example led vs. incandescent bulbs…when you look at the expansion of what has happened in the retail side of paint, when you had transactions that have gone from under $20 to over $20, and..driving off-shelf special buys, value packs…that has led to a shift in transactions..”


How Walmart is going all out with mobile by Paul Sloan at CNET.  “The latest version of Walmart’s iPhone app includes something called “in-store mode,” which is available for the iPhone and coming soon for Android phones. That’s the key feature aimed at keeping Walmart shoppers buying from Walmart, even when what they want isn’t in the store and a rival outlet is just a few taps away in the palm of their hands… Two weeks after Walmart launched “in-store mode” with its app, roughly 60 percent of its shoppers opted to use it. Moreover, about 12 percent of Walmart’s online sales are now coming from customers who are inside a store and using “in-store mode.” All of Walmart’s 4,000 U.S. stores have an “in-store app.”   https://news.cnet.com/8301-1035_3-57548785-94/how-walmart-is-going-all-out-with-mobile/

“Dick’s Sporting Goods CEO Discusses Q3 2012 Results – Earnings Call Transcript” in Seeking Alpha. https://seekingalpha.com/article/1004531-dick-s-sporting-goods-ceo-discusses-q3-2012-results-earnings-call-transcript?page=1

Costco: “On the New Shopping List: Milk, Bread, Eggs and a Mortgage” by Stephanie Clifford and Jessica Silver-Greenberg in The New York Times.  “While Ms. Neubauer, 27, said she was surprised to find the warehouse club selling financial products, she and her husband saved about $200 a month by refinancing there this year. She also bought home insurance from Costco, she said, again because it was cheaper there.”  https://www.nytimes.com/2012/11/14/business/major-retailers-start-selling-financial-products-challenging-banks.html?_r=0

Rite-Aid presentation (PowerPoint) at Morgan Stanley Global Consumer Confidence on 11/13/12.  Includes company overview, current initiatives, new store formats, earnings guidance, etc.  https://www.riteaid.com/www.riteaid.com/w-content/images/company/investors/Morgan_Stanley_11_13_12.pdf

Walgreens presents (PowerPoint and audio) at Lazard Capital Markets Healthcare Conference on 11/13/12.  Takeaway fact — 65% of the US population lives within three miles of a Walgreens, compared to 43% living withing three miles of a Mass store.  https://wsw.com/webcast/lz13/register.aspx?conf=lz13&page=wag&url=http%3A//wsw.com/webcast/lz13/wag/

Family Dollar presentation (PowerPoint and audio) at Morgan Stanley Global Consumer & Retail Conference on 11/13/12.  https://corporate.familydollar.com/pages/investors.aspx

CVS presents (audio) at Lazard Capital Markets Healthcare Conference on 11/13/12.  https://phx.corporate-ir.net/phoenix.zhtml?c=99533&p=irol-EventDetails&EventId=4864716

Accenture Study Finds Half of U.S. Consumers Intend to Purchase Luxury Products in Next Six Months; Small Luxuries Entice Shoppers to Splurge.  “The top reason for shopping in physical stores is to see all the choices in person (38 percent). Nearly a third (30 percent) of shoppers in this category prefer online retailers to get the best price and one-quarter (25 percent) value the convenience of online shopping.The study also found that showrooming, or viewing a product in a store and then going online to make the purchase, plays an important role in luxury purchases. In the past six months, one in five consumers visited a store to experience a luxury product in person and then purchased the product online.”   https://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsLang=en&newsId=20121113005885&div=-1245645151

Survey: Nearly Half of Online Holiday Shopping Will Take Place on Tablets.  “44 Percent of Online Shoppers Will Turn to Tablets for Holiday Purchases this Year; Across Devices, 63 Percent Plan to use Online Catalogs and Gift Guides.  Detailed product reviews are one of the most important requirements for online shoppers, but lack of product information is their biggest gripe, cited among 39% of online shoppers.”  https://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsLang=en&newsId=20121113005391&div=-1245645151