Industry: Aggregate YY Visits decelerated again to -5.8% from -3.4% last week, with 5Wk Avg visits continuing the downtrend from -2.9% to -3.5%. As we have been highlighting over the past two months, visits are staunchly negative, with plenty of more room to fall given the weakening consumer. With Redbook Retail Sales reaccelerating this week from +4.1% to +4.6%, the divergence between visits and same store sales continues. Again, basket is up, inflation continues to come in hotter, personal savings rate is down, and there is potential trip consolidation/higher units per transaction as shoppers look to be more targeted in their spending.
- Notable Industry Callouts: Beauty & Spa saw a sharp deceleration as one of the better industry performers from +6.4% last week to +3.6% this week. This continues the strong deceleration in visits seen in Beauty & Spa since mid-June, bringing it back down toward the industry aggregate level. Discount & Dollar Stores also saw a notable deceleration from +3.9% last week to +0.6% this week. All in all there was not a single acceleration in our industry data this week.
Companies: Numbers below = YoY Rate of Change from week to week
- Notable Accelerations: Vuori +22%, MarineMax +15%, Kay Jewelers Outlet +11%, Big 5 Sporting Goods +10%
- Notable Decelerations: Vince -20%, The North Face Outlet -18%, Kate Spade -17%, The Container Store -14%, Allen Edmonds -13%, Tiffany & Co. -12%, Lovesac -11%, Pottery Barn -11%, Williams-Sonoma -10%, lululemon athletica -10%
Proprietary Weekly Visits Tracker: Custom samples of specific stores that are not made readily available by Placer.ai.
- Key Callouts: Big deceleration in Carter’s visits over the past few weeks on the back of a deceleration from -6.0% last week to -9.5% this week. Positive inflections at both RH Gallery and Outlet stores this week, from -22.8% to -15.0% and -30.0% to -15.3% respectively Best Idea Long RH. Golf Remains bearish across courses and retail stores Best Idea Short GOLF and Short Bias MODG (see Top Golf, PGA Tour Superstore, and Golf Galaxy decelerations in company charts below).
Recent Winners & Losers: No Winners this week in an increasingly weakening consumer environment. Plenty of interesting losers to call out, though.
- Losers: Home Improvement – HD, LOW, FND. Home Improvement data points remain bearish. This week’s traffic trends saw HD decelerate from -8.8% to -9.3%, LOW decelerate from -12.5% to -12.7%, and FND accelerate from -13.2% to -10.4%--but all clearly remain squarely negative. Looking at the industry as a whole, Toro gave us a big demand warning on the homeowner front last week by saying “we experienced a sharp and accelerated reduction in homeowner demand for residential and professional segment lawn care products.” This comment is right in line with our bear thesis on home improvement retail. Lack of home turnover is impacting core product demand and it’s not likely to get better soon given Redfin’s weekly update, which showed active listings down -18%, widening the gap YY that formed in mid spring. Existing home sales should remain in a depression, which will continue to pressure home projects and big-ticket home goods demand. There is also further discretionary spending risk with student loan payments returning and elevated gas/energy costs. HD, LOW, and FND are all Best Idea Shorts as we think bulls are very complacent on the risks to comps and earnings here.
- Losers: Department Stores – Macy’s, Nordstrom, Bloomingdale’s, JCPenney. Department Stores in aggregate continue to see a sharp deceleration in our industry data and that is clearly reflected here in these specific major players’ visits data. This week, Short Bias name M saw a continued deceleration from -27% YY to -29% YY. While that is only a ROC of -2%, compared to 5 weeks ago, Macy’s YY visits ROC is -11% lower—and even worse longer term. Macy’s Bloomingdale’s banner saw a deceleration from -28% to -34% YY and is sitting -14% lower on a ROC perspective from 5 weeks ago… Called out as a loser last week, Best Idea Short JWN continues to get worse. Visits decelerated again this week from -25% to -31% YY and are -15% lower than 5 weeks ago on a ROC basis. Things at JWN keep getting worse and there is no end in sight. Lastly, privately owned JCPenney visits have been relatively stable over the past few months, though remain squarely negative. As a whole, department stores look very bearish and have plenty of room to get worse, especially in a weakening consumer environment with student loan payments returning. Short Bias M, Best Idea Short JWN.
- Losers: Home Furnishing – Williams & Sonoma, Arhaus. This week, things looked bad in the home furnishing industry… Best Idea Short WSM saw a big deceleration in visits across both Williams-Sonoma and Pottery Barn stores, from +3% to -7% and -3% to -15% respectively. Furthermore, compared to 5 weeks ago, Williams-Sonoma YY visits ROC is -14% and Pottery Barn’s are -10%. Short Bias name ARHS has also seen deteriorating visits trends over the past few months too. This week, visits decelerated from -26% to -28%, and are down over 20% on a ROC basis over the past few months, despite the increasing showroom base. On the other hand, Best Idea Long RH, the best name in the space and top luxury furniture company in the world, saw an acceleration in visits this week from -25% to -16% and are flat on a ROC basis over the past 5 weeks. Best Idea Short WSM and Short Bias ARHS.
Charts:
- Industry
- Proprietary Chains
- Companies:
Source: Placer.ai
