Δείτε εδώ την ειδική έκδοση

CORRECTED-BUY OR SELL-Where to invest in retail this holiday?

By Aarthi Sivaraman

NEW YORK, Dec 1 (Reuters) - Shoppers spent more on bargains over the Black Friday weekend, but the deep discounts offered by U.S. retailers are expected to sap already-thin profits.

Retail shares sank on Monday after analysts said an early rush of sales would not save what could be the worst holiday shopping season in nearly two decades.

The National Retail Federation still expects total holiday sales growth to be the worst in six years, while other industry research has forecast the weakest sales since the early 1990s as the country struggles with the most severe financial crisis since the Great Depression.

Analysts are singling out retailers who offer the lowest prices as likely to benefit from consumer preferences this holiday shopping season.

They view luxury-goods chains as carrying particular risk. Some are also worried about electronics retailer Best Buy Co Inc , which is getting squeezed by discounts from Wal-Mart Stores Inc and also faces an unwelcome form of competition after rival Circuit City filed for bankruptcy. The latter is closing 155 stores and selling inventory at those stores at fire-sale prices.

WINNERS

Charles Grom, a JPMorgan analyst, said customers seemed more willing to buy 'non-doorbuster items' at discounter Wal-Mart and department store chain Kohl's Corp on Black Friday, as opposed to shopping at retailers that have higher prices, such as Target Corp, or that have fewer sales events, such as Nordstrom Inc.

'We expect Wal-Mart to remain a standout in our group again in November, with positive traffic trends and seasonal strength carrying forward from the October pace,' he said in a research note. 'We're modeling SSS (same-store sales) up 2 percent in November, one of the few retailers in our space with a positive comp in the month.'

Among the online retailers, Amazon.com Inc seemed ahead of competition, JPMorgan said, citing a survey of 766 U.S. consumers about their attitudes heading into the holiday shopping season.

According to the survey's findings: 'Amazon is emerging as the clear leader in US eCommerce. Nearly 50 percent of respondents plan to shop at Amazon.com this holiday season, and Amazon's reach is 39 percent higher than its nearest competitor.'

Stifel Nicolaus analyst Scott Devitt also saw Amazon as a better choice than rival eBay Inc, which he said had turned into more of a niche marketplace.

'EBay is an iconic brand and we believe the company will retain some level of relevance in the eCommerce landscape in the future,' he said. 'As an investor, we would prefer to own shares of Amazon.com, a company with still a significant market opportunity ahead and a business built for the long-term since inception.'

LAGGARDS

Spending cutbacks from affluent consumers who have seen the financial crisis shrink their stock portfolios, have hurt sales at chains like Saks Inc and Nordstrom, which may not recover, JPMorgan's Grom said.

'A deteriorating luxury consumer will likely remain the topic de jour again in November as we're expecting some of the most discouraging prints of the year from Nordstrom and Saks, down 30 percent and 25 percent respectively,' he said.

For electronics retailer Best Buy, results were mixed over the holiday weekend. Consumers sought out electronics, but continued to gravitate to Wal-Mart for better prices, Pali Capital analyst Stacey Widlitz said.

'The data and stores we have seen do not change our thesis that 2008 will be a rough holiday season for Best Buy,' she said in a note. 'We would continue to avoid the stock, even at historically cheap levels.'

(Reporting by Aarthi Sivaraman, editing by Matthew Lewis) See http://www.reuters.com/news/globalcoverage/holidayshopping for Reuters holiday coverage and http://blogs.reuters.com/shop-talk/ for Shop Talk -- Reuters' retail and consumer blog. Keywords: USA HOLIDAYSALES/ Keywords: USA HOLIDAYSALES/

([email protected]; + 1 646 223 6191; Reuters Messaging: [email protected])

COPYRIGHT

Copyright Thomson Reuters 2008. All rights reserved.

The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

ΣΧΟΛΙΑ ΧΡΗΣΤΩΝ

blog comments powered by Disqus
v