Retail Callouts (11/3): TIF E-comm Traffic, Retail Sales Trends, LB

Takeaway: TIF traffic trends decelerate in 3Q. Rare spike in both ICSC/Redbook, compares easy until Black Friday / Dec, which is what really matters.

TIF - E-comm Traffic Trends Decelerate in 3Q

TIF just closed the books on 3Q, and the traffic trends headed out of the quarter look particularly weak. E-commerce accounts for just 6% of total sales for the company -- but because the average ticket for TIF sits at $750 there is a lot less impulse and a lot more planning before a consumer slaps down a credit card and walks away with a blue box. The metric, which looks at the relative strength of an e-commerce site relative to the internet in aggregate takes into account two metrics (unique visitation and page visits per user), decelerated from +10% YY at the end of the 2nd quarter to -5% at the end of 3Q with marked softness throughout the quarter.

Not a good barometer for brand strength in 3Q, especially when the common perception seems to be that “just because Tiffany (TIF) blew up earlier this year, it can’t blow up again.” We disagree. It actually blew up twice this year. And we think there will be another. Next year's estimates are sitting at $4.54. We think an optimistic number is $4.25. If our Macro team's bearish call plays out according to plan, TIF will be lucky to earn $4.00.

With productivity, margins and returns all near 10-year highs, and the stock trading at 19x a number we don't think is doable, we still like this one on the short side.

Retail Callouts (11/3): TIF E-comm Traffic, Retail Sales Trends, LB - 11 3 2015 chart1

 

RETAIL sales Trends (ICSC / RedBook) - a rare spike in both indices, which happened on the same day LB put up a big comp (3Q at ~7% vs 5% expectations). On the heels of a lot of negative sentiment around retail, this offers up a 1-day reprieve. Note, however, that comps are very easy through most of November -- until Black Friday and December, which is what really matters.

Retail Callouts (11/3): TIF E-comm Traffic, Retail Sales Trends, LB - 11 3 2015 chart2

Retail Callouts (11/3): TIF E-comm Traffic, Retail Sales Trends, LB - 11 3 2015 chart3

Retail Callouts (11/3): TIF E-comm Traffic, Retail Sales Trends, LB - 11 3 2015 chart4

 

LB - L Brands Reports Oct. Comp #s, Takes Up 3Q Ahead Of Investor Day

(http://phx.corporate-ir.net/phoenix.zhtml?c=94854&p=RssLanding&cat=news&id=2105541)

 

DLTR - Dollar Tree completes sale of 330 Family Dollar stores to Sycamore Partners. Stores to be branded Dollar Express.

(http://www.dollartreeinfo.com/investors/global/releasedetail.cfm?ReleaseID=939816)

 

AMZN - Amazon bookstore opening in University Village.  The 5500 SqFt store will carry 5000-6000 titles.

(http://www.seattletimes.com/business/amazon/amazon-opens-first-bricks-and-mortar-bookstore-at-u-village/)

 

AEO - American Eagle Outfitters acquiring Tailgate Clothing Company for $11mm, takes up 3Q guidance.

(http://investors.ae.com/press-releases/financial-news-details/2015/American-Eagle-Outfitters-Acquires-Tailgate-Clothing-Company/default.aspx)

 

GNC - GNC expects to repurchase an additional $200mm shares by year end, raising guidance 2 cents to include the impact.

(http://phx.corporate-ir.net/phoenix.zhtml?c=88669&p=irol-newsArticle&ID=2105684)

 

EBAY - eBay Enterprise Sold Off and Broken Up

(http://www.ecommercebytes.com/cab/abn/y15/m11/i03/s04)

 

99 Cents Only announced Felicia Thornton has been appointed as its CFO and treasurer

(http://www.chainstoreage.com/article/-cents-only-stores-has-new-cfo)

 

SHLD - Sears enters online home services market

(http://www.chainstoreage.com/article/sears-enters-online-home-services-market)

 

BONT - Bon-Ton Stores Announces Extension of Private Label Credit Card Agreement With Alliance Data's Card Services Business

(http://investors.bonton.com/releasedetail.cfm?ReleaseID=939995)

 

GCO - Genesco To Acquire Little Burgundy Chain From The Aldo Group

(http://phx.corporate-ir.net/mobile.view?c=75042&v=203&d=1&id=2105697)

 

Sports Authority Launches New Fitness Training App

(http://footwearnews.com/2015/focus/athletic-outdoor/sports-authority-new-bodyfit-fitness-app-167141/)

 

Selfridges Buys Arnotts Department Store in Dublin

(http://wwd.com/retail-news/department-stores/selfridges-buys-arnotts-department-store-dublin-ireland-10272288/)


7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more

Got Process? Zero Hedge Sells Fear, Not Truth

Fear sells. Always has. Look no further than Zero Hedge.

read more