Target and other discounters miss Street; Ross shines

New York City Target said Thursday strong sales during the Thanksgiving weekend were not enough to offset weak sales during the earlier part of November, sending sales in stores open at least one year down 1.5%.

The drop was bigger than the 0.5% drop analysts were expecting. Target had predicted flat November sales in stores open at least one year. A year ago, the sales comparison fell 10.4%.

The retailer said necessities such as healthcare products, food products, beauty and household, personal and baby products were the strongest sellers. Electronics were also popular, while entertainment products were weaker. Apparel sales fell in the mid-single-digit percentage range, as strong women's apparel was offset by weaker jewelry and accessories sales.

Ross Stores said Thursday that sales at stores open more than one year rose 8%. Analysts polled by Thomson Reuters estimated, on average, same-store sales to rise 6.1%. Total sales for the four weeks ended Nov. 28 increased 12% to $635 million from $568 million.

Michael Balmuth, vice chairman, president and CEO, commented, "November sales outperformed our expectations as business strengthened in the second half of the month. Shoes, Dresses and Home continued to be the strongest merchandise categories while the Southwest and Northwest were the top performing regions."

At Family Dollar, first-quarter same-store sales rose 2.4%. Net sales for the quarter ended Nov. 28 rose 3.9% to $1.82 billion. The discount retailer said that although sales in the period came in slightly below plan, it still expects to post first-quarter earnings in line with expectations.

In other discount results:

• Costco Wholesale Corp. said same-store sales rose 6%, helped by a weaker dollar and higher gas prices, but the results still missed Wall Street's expectations. Costco said same-store sales at U.S. stores climbed 2% for the four weeks ended Nov. 29. Overseas, those same sales jumped 21% in the period.

• BJ's Wholesale Club said its same-store sales rose 1%. Analysts, on average, had expected same-store sales to rise 4.7%.

• Fred's said Thursday that November sales in stores open at least one year fell 3.3%, a bigger drop than analysts predicted. Consumers "utilized layaways to a much greater extent than last year, deferring recognition of those sales until December," said CEO Bruce A. Efird.