Retailers Versus the Payroll Tax Round 2: Expectations and Confidence
“We cannot see any blip in our numbers as a result of the payroll tax kicking in,” said Safeway (NYSE:SWY) chairman and CEO Steve Burd, complimenting a strong fourth-quarter report. Shares took off for fresh 52-week highs and investors quickly turned their attention to February 26, when Macy’s (NYSE:M) reported its earnings and the Conference Board released the February reading of its Consumer Confidence Index.
It’s important to point out that Macy’s fiscal fourth quarter ended on February 2, meaning that sales figures had very little time to digest any possible effects from the payroll tax. But still, strong results inspire optimism in investors, and Macy’s ended Tuesday up nearly 3 percent. Double-digit annual earnings growth and a 3.7 percent comparable-sales increase is hard to be upset with. The real kicker was earnings guidance for another year of double-digit growth in 2013, suggesting that the company also does not have any deep-seated fears about consumer spending.
Macy’s earnings were complimented by the ICSC-Goldman and Redbook weekly retail sales report, which showed healthy year-over-year gains. In fact, year-over-year sales gains were strong for all of February to date, even though week-to-week figures slipped twice. What’s more, consumer confidence spiked for the month…
|Week Ending||ICSC-Goldman Year/Year||ICSC-Goldman Weekly||Redbook Year/Year|
|Feb. 23, 2013||+2.9%||+0.1%||+2.7%|
|Feb. 16, 2013||+1.8%||+2.7%||+3.1%|
|Feb. 9, 2013||+2.1%||-2.5%||+2.4%|
|Feb. 2, 2013||+2.6%||+2.4%||+1.5%|