Retail Roundup: Same-Store Sales Up at Wal-Mart, Costco
Classic case of right place, bad time.
Wal-Mart (WMT) turned in better than expected Same-Store Sales this morning. Costco (COST) did the same.
If this sounds familiar, it should. It was the same story last month and the month prior to that. Indeed, ever since early January when unemployment and oil prices started ramping in earnest, reporting on SSS has been akin to being the beat reporter for the Harlem Globetrotters.
The details for Wal-Mart this month had some slight spins. Electronic sales were cited as particularly strong, which works for the "Man-Cave" thesis.
WMT also nudged estimates higher from 0.82 to a range of 0.82 - 0.84. As a Wal-Mart shareholder, which I remain, this was a nice release. If I were going to wager on the meaning of "0.82 - 0.84" I'd say it means the quarter will really come in at 0.85.
Alas, as would be the case if I were traveling with the Globetrotters, it's hard to find a good way to bet on another Trotters win. My "bet", such as it is, is staying long and sleeping well.
Sticking with the discount and clubbing theme: Costco came in at 5%, ex fuel. There's a reason Costco and Wal-Mart are near their 52-week highs as they manage to find consistent results in a world of consumer pain. The stimulus checks help but the business models for both Costco and Wal-Mart help even more. The companies are in the right place at a bad time for the consumer.
That's as good as it gets for retail stocks you can keep in your portfolio in a low-stress way in 2008. It's not the thrill ride of trying to catch the bottoms in specialty, and you're going to miss the roller-coaster of a "Long Children's Place (PLCE), long J. Crew (JCG) book" but, hey, I'll take it.
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