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With Holidays Over, Wall Street Picking Over Numbers

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By RICHARD MULLINS | The Tampa Tribune

Published: January 6, 2009

TAMPA - Just a couple of weeks after the close of holiday spending, Wall Street is starting to forecast the financial carnage that retail stores will likely report soon.

Some stores likely fared better than others, prompting checkered forecasts from analysts.

• Best Buy Co. Inc. will report sales results Friday likely showing flat sales year over year, Barclays Capital analysts wrote in a research note. Not bad considering other retail data showing an overall 26 percent drop in consumer electronics sales during the holiday season. Odds are, Best Buy took more market share from rival Circuit City Stores Inc., Barclays said.

• Barclays took its already grim sales forecast of between 1 percent and 3 percent down at Macy's Inc. and lowered it to minus 6 percent to 8 percent. The holiday season sales were "highly promotional," analysts said, and vendors who provide goods for the store likely won't be so accommodating in the future.

• Saks Inc. sales likely came in better than expected, but the promotions necessary to drive that traffic were costly. Comparing same stores, profits could be down 17 percent.

• Target Corp. sales likely fell 10 percent (earlier estimates cited a 5 percent drop) due to bad store traffic.

According to a Barclays report, "While few companies are likely to emerge unscathed from this economic slowdown and credit crunch, turbulent times can be opportunities to invest in strong growth companies at attractive prices – we believe Target is one of those names."

On a positive note, JP Morgan recently upgraded shares of online retailer Amazon.com, believing its market share gains will continue.

Reporter Richard Mullins can be reached at (813) 259-7919 or rmullins@tampatrib.com.

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