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A Black Friday Recap: Holiday Season 'Off To A Mixed Start'

AMZN, GOOG, GAP, URBN, WMT

Online Black Friday sales increased over 23 percent year-over-year, CNBC reported, citing data from Adobe Analytics.

Small Business Saturday was set to reach $3 billion in sales, while Cyber Monday is expected to produce a new record of $7.8 billion, an 18-percent increase from 2017.

Raymond James analyst Aaron Kessler and KeyBanc Capital Markets analyst Edward Yruma reviewed Black Friday shopping trends among some of the most popular names in retail.

E-Commerce

E-commerce sales have increased roughly 14 percent in the third quarter of 2018, according to Department of Commerce research, Kessler said in a note.

“Based on the data, we maintain our positive bias on Amazon.com, Inc. (NASDAQ: AMZN)’s offerings and Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG) shares.”

“We would note that the holiday season sales are generally occurring earlier in the quarter, and we have seen a slowdown the last couple of years from the strong Thanksgiving weekend sales. We expect additional data points on Cyber Monday over the next couple of days as well.”

Adobe Inc. (NASDAQ: ADBE) reported 25.3-percent growth on Thanksgiving and Black Friday, while Mastercard Inc. (NYSE: MA) revealed an increase of 9 percent year-over-year, according to Raymond James.

Amazon's sales surpassed last year's within the first nine hours on Black Friday, the company said. 

Brick-And-Mortar

Overall Black Friday traffic appeared strong compared to years past for retailers like Walmart Inc. (NYSE: WMT), Gap Inc. (NYSE: GPS)'s Old Navy and Urban Outfitters, Inc. (NASDAQ: URBN) said KeyBanc's Yruma.

“Based on our observations, we believe the holiday season is off to a mixed start in our coverage," the analyst said.

Initial data suggest softness at many physical retailers and lower Thanksgiving and Black Friday traffic, Yruma said. The shift to e-commerce and broadening of the sales holiday timeline weighed on initial holiday season results, he said.

“From a sector perspective, we have a more positive outlook for underlying trends at select dollar/discount retailers, where we believe underlying trends are stronger and e-commerce competition is more muted.”

Home furnishing trends appear troublesome, while toy brands and leisure sectors performed in line with analyst expectations, according to KeyBanc. 

Related Links:

Best Buy Posts Strong Earnings Just In Time For Black Friday: The Sell-Side Reacts

Black Friday Shopping Schedule: Everything You Need To Know



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