According to the National Retail Federation, 197 million Americans shopped over the 5 days from Thanksgiving weekend through Cyber Monday. There are only216 million Americans over 15 years old in the country. Even allowing for double-counting, that’s a good turn-out for a fake holiday with unexceptional discounts.
Who won?
Well according to our Retail and Consumer expert Jeff Macke,
"Abercrombie won the mall. Walmart won Discount. William Sonoma and Dick’s Sporting Goods have won Home and Sports so hard they’re running out of chains to compete with. Amazon is winning the world and barely seems to care about (or profit from) retail at all."
Foot-traffic in the stores actually climbed vs last year. 81.7 million people actually went to a store on Black Friday.
Most people I talk to would prefer a simultaneous root canal and a colonoscopy over shopping at a mall on Black Friday. Yet there we were, at the mall, ignoring our oral and digestive health:
Foot-traffic exceeded total cyber traffic for the first time since COVID. Mall traffic in general is pretty slow, according to the data, and companies who reported this week (AEO, FL, LULU and VSCO all mentioned uneven foot-traffic as contributing to bumpy sales).
Christmas shopping is a vibe. Most people don’t keep detailed lists. They wander, people watch and drop in to stores that catch their eye. Fringe-players like Foot Locker (more on them in a moment) lack the riz to get shoppers off the couch. Dicks has a better selection of non-Nike stuff and is probably closer. Without traffic FL is dead even faster than they are dying already.
People not being afraid of or grossed out by the mall is good for America. It suggests a slight uptick in civility. A certain ambition. It also explains why the consumer is better than most analysts expected.
For investing purposes note well that Consumer Discretionary stocks as a group were bullish on Christmas shopping before Wall Street got on board. The group is breaking to ATHs and the better of the stocks have been screaming higher since the August market lows:
In a month we can sell the early News confirming a better-than-expected holiday selling season. That sounds like next year’s problem. For the moment there’s a little juice left in the group.
Lululemon and Victoria’s Secret reported this week. Lulu was 16% higher yesterday with negative comps in North America. Look at VSCO and LULU since August. Absolutely ripping higher, VSCO to new highs and LULU making up lost-ground.
You don’t have to chase, you can try a trading short, but I’d prefer to stay long or get out of the way.
Lulu was “fine” by the way. Absolutely huge growth in Asia. Crazy. Weakness in North America was what killed shares of LULU last March (shares were ~$500 after the Q4 report and tanked $80 in minutes after the CEO noted that US demand had become “challenging”).
The rest is best summed up in chart form. In short, the stock is on an absolute tear and not far from entering a huge gap in the chart over $418, which is where the stock opened after the whole “Challenging” guidedown and what has followed:
Finally, the best stock of the week and my favorite chart: Build-a-Bear Workshops (BBW). Shares rose 8% this week, making a new high for the first time in nearly 20 years. It’s been an amazing comeback story and a tremendous stock.
We’ll talk about BBW and other cheap consumer plays in the coming weeks. Enjoy the weekend!
- Jeff
JC here.
Come on. How good are Jeff Macke's charts?
I'm ok admitting that they just might be better than mine.
