While earnings reports coming out from key retail names this morning.
Results come on the heels of Home Depot, missing Wall Street QT earnings estimates, but shares jumped as the retailer posted a return to consistent same store sales growth in the US.
Joining me this morning is Avio Silvera of Wall Street Media to weigh in on the latest retail earnings.
So good morning, Aviia.
Thank you so much for joining me.
Yeah, absolutely.
We got a mixed batch of earnings, right?
Out this morning, some moves to the upside, some to the downside.
Let's start with TJX, the parent company of some names that are familiar to us, including TJ Maxx, as well as HomeGoods.
What did you make of the results?
Obviously I'm not the only one looking for a bargain.
And so in any economy there's always a little place for those bargain hunters to find some resilience, and TJX has done.
Very nice job of meeting expectations like a 5.1% year over year increase.
So the off price model durability, great in choppy waters, you know, you're when you're looking at what they're overall doing $14 billion slight miss on earnings per share by 1 cent.
I think that anything that's showing a positive on the upside in retail gets a little bit of investment.
Excitement.
What we, what we really need to look at is how do they penetrate going upstream, right?
We know they've got a great budget base, but in home goods we're going to talk about somebody else in the home improvement industry.
Are is there a more of a sales from their home goods division or is going to TJ Maxx and the good old fashioned cloth at a discount going to really drive their forecast moving forward, which was unchanged?
Yeah.
And Aelia, I do want to quickly move on to Lowe's speaking of home improvement.
So we heard from Home Depot yesterday and we've been talking about this bifurcation of the American consumer here.
So what did you make of Lowe's results and also of their acquisition?
You know what's interesting is Lowe's, I think they might have had the same boardroom playbook that Home Depot did, turning over to pros to contractors to.
Find some stabilization very good for them.
I'll just tell you what I'm looking at is estimates, right?
And so when you've got topping estimates $4.27 versus the expected $4.24 making a 5.6% year over year rise despite a little bit of a revenue miss on the top line, that tells me that they've got good margins, that going with the pros is making sense.
Yeah, and let's talk about Target here.
Do you think this was a bull's eye or not, because we're looking at shares tumbling 10% free market.
You know, this morning's headline for Bullstreet at Bullst.com was about them bottom fishing.
Um, we saw the CEO announcement coming.
I can't tell you.
I thought it was coming today, but we knew it was going to be coming eventually.
There's nowhere for Target to go than for Up.
And if they they've done some great investments with Shift, how they get to the consumer, some of these stores, I think if they get back to the basics that they. did right through the pandemic, they can see something but they're in a tough spot right now.
So we get a little bump from a new CEO maybe, but I actually think that they're in a place where they can find the efficiencies to lead to some market expectations.
Yeah, and speaking of finding efficiencies, what did you make of Estee Lauder?
Well, um, you can't put lipstick on a pig, and there's just a lot with Estee Lauder's miss that doesn't make me feel all that great.
Um, you've got some supply chain issues, you've got some pricing issues and ideally, uh they just uh they kind of find themselves in a stream of either getting to some type of a of a premium. but there's a lot in the under the covers there at Estee Lauder that made me a little bit worried.
I'd be super cautious on letting them have a good quarter before I put them back in the rotation.
Yeah, I like that analogy there, Emilio, but last but not least before I let you go, we've been hearing from retailers all week, but we're still awaiting Walmart, right?
That's the nation's biggest retailer and of course those results really matter.
So what are you looking for in those results?
I'm looking at not just same store sales, I'm looking at the division of where they're seeking some revenue.
Is it coming from retail goods, consumer goods, or is it coming from grocery with the changes to EBT from the from Department of Health.
That what you can buy at the store is going to change.
So if grocery projections still look good, that's a strong foot in the door.
They're going to buy some other things in retail when grocery prices are restricted on some of the uses of our consumers, they're not going to buy some of the other goods at Walmart.
That's those are the key indicators I'm looking for.
OK, Villi, great to have you on again.
Thank you so much for sharing your insights.
Always great to be with you.
