Piper Jaffray Retail Analysts Provide Initial Thoughts on Early Black Friday Activity

Retail analysts at Piper Jaffray offered some initial Black Friday observation for various retail channels including specialty retail, fashion and household, among others.

In Household, Beauty, and Children’s Products, analyst Stephanie Wissink commented: "We spent Thanksgiving evening and the early hours of Black Friday visiting various retail formats (malls, dept stores, discounters) across multiple cities in the U.S. From our initial observations, we think the toy category was a notable winner - product was compelling and well merchandised, promotions were slightly less aggressive to PY, and floors were well-shopped. This is positive for HAS, MAT, and JAKK. Within Beauty, traffic at specialty was strong (namely Sephora and ULTA), but we found beauty category footfall at dept stores (major and mid-tier) and discounters to be below average. Cosmetics (esp. lip) and nail color were the standouts; fragrance pricing (and gift with purch) levels were more aggressive and conversion appeared weak. This is positive for COTY and ULTA. Within Household Products, doorbusters across small electronics were spotlighted, but lack of a "must have" item likely puts the segment "in line" with plan, at best." Stocks Mentioned: Coty, Inc. (NYSE: COTY), Hasbro (NASDAQ: HAS), JAKKS Pacific (NASDAQ: JAKK), Mattel Inc. (NASDAQ: MAT), and Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ: ULTA).

In Global Fashion & Lifestyle Brands, analyst Erinn Murphy commented: "Our team walked retail stores in Minnesota and Texas across outlet formats, B+ malls, big box retailers and even A+ centers. With opening hours even earlier this year versus last year, it appeared that initial traffic into stores was more muted. Most specialty vertical retailers offered 40%-60% off entire box. From the brand perspective, we saw a more noticeable effort to segment promotions vs. using % off everything. Categories that appeared to be strong included electronics, toys, footwear & handbags. Brands that were noticeably less promotional included Calvin Klein, Coach & Steve
Madden. Brands that were more promotional included Ralph Lauren, Guess & Wet Seal. Brands that were similar to LY included Finish Line & Footlocker. Stocks Mentioned: Coach (NYSE: COH), Finish Line (NASDAQ: FINL), Foot Locker (NYSE: FL), Guess?, Inc. (NYSE: GES), Pvh Corp. (NYSE: PVH), Steven Madden Ltd (NASDAQ: SHOO), The Wet Seal (NASDAQ: WTSL).

In Multi-Brand Retail & Specialty Commerce, analyst Neely Tamminga commented: "The Piper Jaffray Consumer Research Team shopped across multiple markets on Thanksgiving and Black Friday to help walk off the derby pie calories and assess the kick off to the holiday shopping season. Based on our checks, we highlight four themes: 1) blurring of the days with Black Friday deals having kicked off as early as Monday this week causes for less of an immediate call to action during Thanksgiving and Black Friday; 2) blurring of the channels also keeps people out of the mall during Thanksgiving and Black Friday as folks could access most deals from home via their mobile phones and computers; 3) home-related goods, toys, accessories, and jewelry were products of choice in most instances; and 4) anchors like JCP, KSS, and M were busier than the interior of the mall. Stocks Mentioned: JCPenney (NYSE: JCP), Kohl's Corp. (NYSE: KSS), Macy's (NYSE: M).

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