As the nation's retailers reported their sales results early Thursday morning, stores including Wal-Mart Stores Inc., J.C. Penney Co. Inc., Talbots Inc., and Costco Wholesale Corp. beat Wall Street expectations.
"Early going, consumers are hanging in there, despite facing significant pressure on their discretionary income," said Ken Perkins, president of Retail Metrics LLC, a research firm in Swampscott, Mass.
Perkins noted that two-thirds of the retailers he tracks surpassed expectations; the remainder missed estimates.
October's results are surprising given retailers' continued struggles throughout October, including the effects ofand unseasonably warm weather that dominated the month. That made selling cold weather items like sweaters and coats difficult.
Still, retailers are preparing for a difficult holiday season. Although gasoline prices have slipped back from $3-plus levels in recent weeks, they still are quite high, andare expected to soar this fall and winter, forcing many consumers to budget carefully for the holidays. And last week, the latest reading showed Americans even more pessimistic about the economy during October.
Wal-Mart had a 4.3 percent increase in sales at stores open at least a year, known as same-store sales and considered the best measure of a retailer's strength. The figure beat the consensus from Thomson First Call, which estimated a 3.0 percent gain. Total sales rose 10.5 percent.
Costco had a 10 percent increase in same-store sales for the month, helped by the rise in gasoline prices as many of its stores have gas pumps. Excluding the effects of gas price inflation, same-store sales would have been up 8 percent. Analysts expected a 7.7 percent increase; total sales rose 12 percent.
J.C. Penney Co. Inc. reported a 2.4 percent gain in same-store sales in its department store business, better than the 2.0 percent estimate. Total sales rose 1.7 percent.
The Talbots Inc. posted a same-store sales decline of 0.3 percent, better than the 1.3 percent drop Wall Street expected. Total sales rose 3 percent. Based on better-than-expected sales, the company raised its earnings outlook for the third quarter.
Federated Department Stores Inc. posted a 0.7 percent decline in same-store sales for the month, worse than the 1.7 percent gain Wall Street expected. Federated's total sales, which include the acquisition of May Department Stores Inc., which was completed in August, nearly doubled. Same-store sales include only Macy's and Bloomingdale's locations open for more than one full fiscal year.