Retailers Have Lost Some of the Momentum Gained Earlier This Year
June 22 2010 - 8:20AM
Marketwired
www.rothmanresearch.com -- The retail industry takes most of its
mana from consumer confidence which according to the Conference
Board Consumer Confidence Index surged for the third consecutive
month in May. The increase of 65.9 for May 2010 is the highest
level the index has recorded since March 2008. Additionally, retail
sales were up 7.4% year-over-year, but as compared to the previous
month sales in the retail space declined by 1.2%. Looking closely
at those sales figures for May, it becomes perceptible that
consumers lost a bit of their appetite for shopping in the month of
May. A few factors that still keep consumers and retailers edgy are
the painstaking recovery in the U.S. jobs market and income growth.
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OfficeMax Inc. (NYSE: OMX) which reported
its most recent quarterly earnings at the end of April surprised
Wall Street as it delivered a staggering increase of 95% in
earnings. The company cited cost cutting measures behind this
surge. Another positive from OfficeMax is the company's balance
sheet is indicating a better cash position with $564 million.
Staples Inc. (NASDAQ: SPLS), U.S. top office
products retail supplier, also posted better-than-expected
quarterly earnings late May with sales surging to $6.1 billion.
Earnings were up 32% as compared to the same time period in 2009.
However, the company reported only a 1% increase in its same-store
sales in North America underlying the current weakness in the
economic recovery process.
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are available by signing up now at
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http://www.rothmanresearch.com/article/spls/23605/Jun-22-2010.html
An improving employment level could be the catalyst to a strong
recovery in the retail space. With the next report from the
Conference Board Consumer Confidence Index due at the end of June,
analysts are expecting better comp readings from retailers boosted
by Memorial Day, Father's Day and graduation gift sales. Retailers,
nonetheless, prefer to keep a cautious stance regarding outlook for
the rest of 2010.
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