The last presents have been unwrapped, the final drops of eggnog have been drunk, and most Christmas trees are either boxed up for next year or waiting for trash pickup. That means the retail holiday season has ended, and it's clear which companies have won and which have lost.
This was a holiday season that, in many cases, confirmed what we already knew. Sears (NASDAQOTH:SHLDQ) performed poorly, and Amazon.com (NASDAQ:AMZN) crushed it. But there were some pretty big surprises.
Here are the winners
Whereas the holiday season used to be the Friday after Thanksgiving through New Year's Eve, most retailers now consider the period to include all of November along with December. That meant that while there were some major sales days (Black Friday, Cyber Monday), the entire season was more a marathon than a sprint. The big winners are companies that treated the season that way:
- Amazon: The online leader has not yet reported actual sales numbers, but it has claimed a "record-breaking holiday season." The company also noted that customers "purchased millions more Amazon Devices this holiday season compared to last year."
- Target (NYSE:TGT): The retailer saw comparable-store sales grow by 5.7%, an improvement over last year's 3.4% growth during the November/December period. That was driven by increased traffic and a slight uptick in the size of the average ticket. Digital sales rose by 29% during the holiday period.
- Barnes & Noble (NYSE:BKS): It's been a long time since the bookseller has reported any good news, but that changed over the holidays. The company said that comps increased 4% between Black Friday and New Year's Day, and 1.3% for the nine-week holiday period ending Dec. 29, 2018. That's the best comps period for the company "in several years," according to a press release.
- Kohl's (NYSE:KSS): This is more of a small winner than a big one. It posted a 1.2% comps gain for the nine weeks ended Jan. 5, 2019, versus Jan. 6, 2018. That's decent, and the company actually moved its full-year earnings forecast slightly higher from a range of $5.35 to $5.55 per share, to a new range of $5.50 to $5.55.
- Costco (NASDAQ:COST): The warehouse club reported net sales of $12.77 billion in November, up 9.8% from $11.63 billion last year. In December (through Jan. 6), sales were up 7.8% to $14.42 billion, an increase from $14.30 billion in 2017.
Walmart and Best Buy both expect to be winners, but had not reported holiday sales at the time this article was written.
These are the losers
Losing comes in degrees when you look at the holiday season. In a case like Macy's (NYSE:M), numbers were lower than expected, but the company's overall health is not in doubt. That's not the case for every company on the following list:
- Sears: The struggling retailer has not released full holiday season financial info, but its numbers came in well below expectations. That left the future of Sears and Kmart very much in doubt, as chairman Edward Lampert has made multiple bids to keep about 425 stores open but a bankruptcy judge could decide that liquidation is a better choice for stakeholders.
- J.C. Penney (NYSE:JCP): While it's not in as dire shape as Sears, things are not going all that well for Penney. Comps declined by 3.5% for the combined nine-week period ending Jan. 5, 2019.
- Macy's: The retailer reported that comps were up 0.7% for owned stores and 1.1% on an owned/licensed basis. That caused the company to revise its forecast for comps growth to flat from a 0.3 to 0.7% increase.
The holidays aren't everything
While the holiday season may have put the rotten icing on Sears' putrid cake, November and December sales aren't always telling for where a company stands. Sometimes, an off holiday season is just that. For example, Best Buy had a disappointing holiday in 2015, but that was a small blip in its overall comeback story.
These numbers are important, but Macy's shareholders shouldn't panic -- the slower-than-expected holiday season should be a speed bump, not a brick wall, on its comeback path.
Check out the latest J.C. Penney earnings call transcript.