November fades to black

Aheavy turnout on Black Friday led to early enthusiasm about the state of the consumer. However, by Sunday it became apparent that the heavy traffic had not translated to meaningful sales growth, and by Monday investors were dumping share of retailers over concerns that November same-store sales, due out Thursday, would be weaker than previously indicated. That was the case at Target, where expectations of flat November comps were predicated on a solid Black Friday showing in order to offset weakness earlier in the month. When it didn’t happen shares of the company, along with those of virtually every other retailer, tumbled $1.XX on Monday to close at $4X.XX. Target shares were already trending downward following release of the company’s third quarter results on Nov. 17. At that time, company CFO Doug Scovanner tempered analysts’ enthusiasm for Target as reflected in their earnings estimates by noting, “Sell-side analysts are somewhat more optimistic across most of our industry that we believe is warranted in light of the harsh realities of the current environment.” Those harsh realities became evident over the weekend as consumers took advantage of retailers’ door-buster deals but not much else.