Roxyretail Rack Attack: With Promos Like These, Will Black Friday Be “Blah Friday”?

Roxyretail Rack Attack: With Promos Like These, Will Black Friday Be “Blah Friday”? by Roxanne Meyer

Meyer said, "Retailers aim to benefit from traffic over Veteran’s Day weekend
We saw aggressive promotions – in many cases, store-wide – as retailers tried to capitalize on mall traffic from Veteran’s Day being on a Friday this year. About 60% of our retailers were more promotional than last year: Abercrombie & Fitch (NYSE: ANF), AnnTaylor (NYSE: ANN), Express (Nasdaq: EXPR), Old Navy (NYSE: GPS), Talbots (NYSE: TLB), and Urban Outfitters (Nasdaq: URBN). Promotional levels were inline at Aropostole (NYSE: ARO), American Eagle (NYSE: AEO), Chico's (NYSE: CHS), and Gap. Coldwater Creek (Nasdaq: CWTR) and Banana Republic were less promotional."

"Already seeing several blanket promotions at the mall and on-line: While we typically don’t see aggressive blanket promotions until Black Friday weekend, some retailers are in the holiday spirit a bit earlier. A&F/Hollister offered 25% off purchase, AEO 20% (with android/iphone app) – we think incremental. Ann/LOFT’s 40% off Friends & Family was deeper (30% off LY) and one week earlier vs. LY. Gap offered 30% off purchase (similar to LY) but 40% off for Facebook and Twitter fans. Talbots offered 30% off purchase, incremental to LY."

"URBN: marginal improvement at UO; still in early innings at Anthro - Promos were up slightly at UO/Anthro (likely carryover). We think UO’s holiday mix is dressier and marginally better vs. Q3. We think Anthro lacks novelty/femininity, especially at its lofty prices. Lounge was 30% off; ~15-20% of the store was on sale."

"Estimate/price target revisions – ANF & EXPR: Slightly raised ANF estimates (still below Street); PT remains $60. Raised EXPR PT to $26 from $24 (14x ‘12E EPS, up from 13x) based on our bullish view on trends."

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