EC Previewing The Retail Sector's First Coronavirus Earnings Season

The Q1 earnings season has effectively come to an end for most of the major sectors, with the Retail sector as the only one that has a significant number of reports still to come. We will start getting those results this week, with a number of major players like Walmart (WMT), Target (TGT), Home Depot (HD) and others on deck to report results.

The Retail space has been hit hard by the pandemic-related lockdowns, as Friday’s April Retail Sales report showed. But the three big-box operators mentioned here don’t belong on the ‘victims’ list; they have thrived during this downturn and will likely continue to do so in the days ahead.

A number of others like TJX Companies (TJX), Kohl’s (KSS), Nordstrom (JWN) and others that are reporting this week are going through a very painful phase in their lives. Macy’s (M), which would normally be reporting this week as well, has put off its quarterly release for now but will instead share some preliminary results this week. 

We typically associate the traditional brick-and-mortar operators as the only ones belonging in the retail space, with the traditional industry/sector classification systems putting those companies either in the Consumer Discretionary sector or in the Consumer Staples sectors. In that system, online vendors get placed in the Technology sector. But we have a stand-alone Retail sector that not only includes the traditional players but also online vendors and restaurant operators.

For the Zacks Retail sector, one of the 16 Zacks sectors, we have already seen Q1 results from 17 of the 36 companies in the S&P 500 index. Most of the Retail sector results that have come out already are from online operators and restaurant players, with the traditional brick-and-mortar players starting to report this week.

Total earnings for these Retail sector companies that have reported already are down -15.1% from the same period last year on +11.2% higher revenues, with 70.6% beating EPS estimates and 88.2% beating revenue estimates. The comparison charts below put these Retail sector results in a historical context.

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