New York, NY, Jan. 8--Wal-Mart's sales at U.S. stores open at least a year rose 4.3% in December, well within the 3% to 5% projection some analysts thought the retailer might not be able to achieve.
Analysts surveyed by Thomson First Call had forecast an average estimate of 3.3% growth for the world's biggest retailer.
However, the Bentonville, AR, company warned Thursday morning that with two months of its fiscal quarter now complete, earnings are likely to end up near the low end of its projections of 63 cents to 65 cents a share for the period. Wal-Mart predicted January same-store sales would rise 3% to 5%.
During the five-week period ending Jan. 2, same-store sales at the company's flagship Wal-Mart stores rose 3.9%, driven by strong sales of food, pharmacy, infants, girls apparel and toys categories. Sales of boys and ladies apparel and housewares were weak, Wal-Mart said.
Same-store sales at its Sam's Club unit rose 6.1%, with particular strength seen in the pharmacy, furniture and seasonal categories.
Overall sales for the period increased 11% to $33.657 billion, up from $30.251 billion in the year-earlier period.
J.C. Penney, meanwhile, said its same-store sales increased 4.3% for the five weeks ended Dec. 27. Sales were particularly strong in the days before and immediately after Christmas, the company said. The results beat analysts' average estimate for 1.3% growth.
Catalog and Internet sales increased 5.6%, Penney said.
The company's Eckerd drugstore chain, which is slated for a merger, sale or spinoff, saw same-store sales fall 2.5%, missing analysts' expectations for a 2.1% decline. But the chain's operating profits are expected to drop by 50% to 60%, J.C. Penney said Thursday.
The company said it expects both comparable department-store and catalog/Internet sales for January to be up low single digits, and comparable drugstore sales to be down low single digits.
Despite the Eckerd woes, J.C. Penney still expects to meet its previous full-year earnings-per-share forecast of $1.25, which assumes fourth-quarter earnings of 80 cents.
Most retail-sector analysts entered the holidays with rosy projections, betting that tax cuts and a bullish stock market would fuel a robust holiday. They were half right: Those factors appear to have boosted spending by the wealthy at upscale retailers, but shoppers with thinner wallets were relatively cautious this holiday season.
Although markdowns grew steeper as December wore on, middle-tier department stores also remained fairly empty, right up to Dec. 25, according to some analysts. Across the board, retailers had a hard time playing "chicken" in a markdown game with savvy shoppers, who each year increasingly are holding out on Christmas purchases in search of last minute bargains.
One of those department store operators was May Department Stores Co., which said early Thursday that same-store sales for the five weeks ended Jan. 3 rose 1.6%. The company credited gifts for lifting its performance above the 1.8% average decline projected by analysts surveyed by First Call.
May, which owns department stores including Lord & Taylor, Filene's and Hecht's, said total sales in the period rose 2.3% to $2.52 billion from $2.46 billion a year ago. Sales were driven by strong traffic in costume and silver jewelry, handbags, small leather goods, ladies' tops and cold-weather fashions.
