Retailers Report Another Mediocre Quarter; Bush Set To Announce Mortgage Freeze Plan
Retailers reported November same stores sales this morning and the numbers again appear mediocre. Same store sales increased 4% but because of a calendar shift, this year’s November included the week after Thanksgiving whereas last week’s “November” did not (subscription required). That’s an important week so it probably juiced the number a bit.
Walmart (WMT) reported a 1% increase at US Walmart stores (WMT Press Release), continuing their underwhelming sales trend.
Target (TGT) was, again, notably week posting a 1.1% same stores sales increase on a comparable basis (TGT Press Release). In a recorded phone message, they also said that December was looking weak and needed to improve if they were to meet earnings targets.
Target shares are back in the woodshed, down more than 7%. When a leading retailer like Target is having this many problems and its stock getting hit like it has the last couple of months, that raises red flags for me.
Numbers from Costco (COST) and Nordstrom (JWN), which cater more to the upper middle class, were, however, strong.
The other big story of the day is that President Bush is reportedly ready to announce his mortgage freeze plan to help homeowners who would otherwise be in big trouble when their adjustable rate mortgages reset higher (subscription required).
Hopefully he’ll do a better job with this than he did with Iraq. If the nation falls into recession, his presidential legacy is likely to be one of the worst ever, having dragged us into an apparently unwinnable war and having the economy fall into recession during his last year in office – which will have very little to do with his policies but for which he will nevertheless be blamed.