New York City -- Sales at Macy’s, J.C. Penney and Kohl’s surpassed analysts’ estimates in February amid gradually moderating temperatures and rising consumer confidence. However, analysts warned that a late Easter and rising gasoline prices could impact sales going forward.
Confidence among U.S. consumers rose in February to the highest level in three years, according to a Thomson Reuters/University of Michigan index, as a drop in unemployment helped overcome concern over rising food and fuel costs.
Target fell short of expectations. The chain said Thursday its same-store sales rose 1.8% for February, missing analyst expectations for a 2.2% increase.
Target said more than half of its February same store sales gain was driven by an increase in transactions combined with a small increase in the average transaction size. Sales rose more than average in California, South Florida and the Mid-Atlantic, but less than average in the Midwest, the Carolinas and the Northeast. Grocery and clothing sales rose while home products and electronics sales fell. The chain's total revenue for the four weeks that ended Feb. 26 rose 2.4% to $4.75 billion.
“Target’s February comparable-store sales were in line with our expectations, as our REDcard Rewards and PFresh remodel programs continue to drive meaningful incremental sales and traffic in our stores,” said Target chairman, president and CEO Gregg Steinhafel.
The rewards program was launched last fall at stores nationwide and offers those who used Target branded credit and debit product 5% off all purchases.
Target expects March same-store sales to fall because Easter-related sales will be pushed to April, with Easter falling three weeks later. Other retailers also warned that the late Easter holiday would cut into March sales.
J. C. Penney Co. said that its same-store sales in February increased 6.4%, with women's apparel and accessories, children's apparel, and fine jewelry reporting the strongest results for the month.
Geographically, J.C. Penney said all regions experienced comparable-store sales gains, with the northeast and southwest regions delivering the best performances.