Major retailers could report disappointing fiscal first-quarter results due to cooler-than-average spring temperatures, according to one weather analytics expert.
As a result of the weather in March and earlier in April, spring merchandise has been sitting on store shelves longer than usual, and retailers have been offering discounts to clear out inventory and make room for summer products, Paul Walsh, vice president of weather analytics at The Weather Channel, told "Big Data Download."
Consumers' seasonal shopping habits depend more on the weather they feel and not so much their expectations for the weeks ahead, Walsh explained.
But as temperatures gradually rise, so will consumer interest in seasonal items, Yahoo search trend data suggest. For instance, searches for "gardening supplies" were up 434 percent, searches for "patio umbrellas" were up 998 percent and searches for "BBQ grills" were up 654 percent in the 30 days ended April 27, compared with the prior 30 days.
But cooler-than-normal temperatures haven't just affected sales of plants, patio furniture and grills at home and garden stores such as Home Depot (HD) and Lowe's (LOW). Big box retailers like Wal-Mart (WMT) and Target (TGT), which also rely on seasonal sales, and apparel retailers such as Gap (GPS), Ross Stores (ROST) and TJ Maxx (TJX) could see disappointing sales numbers in the first quarter.
Many retailers end their fiscal years in January or early February, so those companies will likely feel the pinch of cool April weather in their fiscal first quarters.
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Investors feeling the spring chill may stay away from retail chains that reported disappointing monthly sales numbers, Walsh said. But as the weather warms, they may be less forgiving of lower-than-expected sales. However, Walsh said he expects retail sales to improve along with temperatures.
- Natural Phenomena
- Nature & Environment
- The Weather Channel