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How Thanksgiving Sales 'Started Off With A Bang, But Ended With A Whimper'

Kevin Riley

Brean Capital noted that “Thanksgiving weekend sales started off with a bang, but ended with a whimper.

"Based on preliminary estimates from ShopperTrak," it wrote, "which estimated the combined sales for the 2-day period of Thanksgiving Day and Black Friday were down 0.5 percent versus last year, as well as our own channel checks, the Holiday 2014 season is off to a somewhat muted start, which we attribute to Black Friday sales starting in late October, thereby taking some of the luster away from the weekend.”

While the weekend may have ended “with a whimper,” Bank of America maintained Michael Kors Holdings Ltd (NYSE: KORS) and Dicks Sporting Goods Inc (NYSE: DKS) as Top Picks following Black Friday checks.

“In one Macy’s KORS handbag shop-in-shop, additional registers had been set up to deal with the long lines,” according to the analyst note.

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Bank of America also commented that DKS “had strong traffic on Black Friday (most locations opened 5pm Thursday) supported by an increased TV/digital marketing effort (including collaborative marketing with key brands).”

Morgan Stanley reported that “headlines suggest lackluster US retail Black Friday sales, but our store checks imply Branded Apparel & Footwear sector fundamentals outperformed and make us incrementally bullish on these stocks. We now see more upside than downside to Street 4Q EPS estimates."

Winners were Deckers Outdoor Corp (NYSE: DECK), Nike Inc (NYSE: NKE), Foot Locker, Inc. (NYSE: FL), VF Corp (NYSE: VFC) and Skechers USA Inc (NYSE: SKX).

Wedbush reported that “mall checks indicate Old Navy [Gap, Inc (NYSE: GPS)] was a clear winner on Black Friday weekend, with traffic and conversion strong across all regions” and that Zumiez Inc.’s (NASDAQ: ZUMZ) “full-price sales momentum continues.”

Wedbush also believed that GoPro Inc (NASDAQ: GRPO) “was a key Black Friday item, and [expected] strong sales throughout the holiday selling season” while Best Buy Co Inc (NYSE: BBY) was the “most aggressive with software discounts.”

For online sales, Cantor Fitzgerald saw Amazon.com, Inc. (NASDAQ: AMZN) as one of the “biggest beneficiaries” of holiday shopping with “3P SSS for Thanksgiving, Black Friday and Cyber Saturday up 25.9 percent, 24.2 percent, and 45.9 percent Y/Y, respectively.”

eBay Inc (NASDAQ: EBAY) “seems to be holding its own so far. 3P SSS on eBay rose 3.0 percent Y/Y on Thanksgiving Day, 26.9 percent on Black Friday (driven by deals of the day), and 14.9 percent on Cyber Saturday,” according to the Cantor report.

Wunderlich maintained a Buy rating on Guess?, Inc. (NYSE: GES), G-III Apparel Group, Ltd. (NASDAQ: GIII) and PVH Corp (NYSE: PVH) and noted that earnings are still to come but that the firm is expecting strong results.

Latest Ratings for KORS

Date Firm Action From To
Nov 2014 Barclays Upgrades Underweight Equalweight
Nov 2014 Canaccord Genuity Maintains Buy
Nov 2014 Jefferies Upgrades Hold Buy

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