Mixed Trick or Treat Bag for US Retailers this Halloween

0
Mixed Trick or Treat Bag for US Retailers this Halloween

As a result of the coronavirus restraining normal activities, including traditional Halloween events, such as trick or treating and costume parties, retailers are feeling the pinch of a scary Halloween season.

Get Our Activist Investing Case Study!

Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below!

Q3 2020 hedge fund letters, conferences and more

In collaboration with StyleSage, Refinitiv reviews this year’s Halloween discounts and consumer purchasing behavior in the report: It’s a Mixed Trick or Treat Bag at Halloween for US Retailers

Crypto Hedge Fund Three Arrows Blows Up, Others Could Follow

CryptoA few years ago, crypto hedge funds were all the rage. As cryptocurrencies rose in value, hundreds of hedge funds specializing in digital assets launched to try and capitalize on investor demand. Some of these funds recorded double-digit gains in 2020 and 2021 as cryptocurrencies surged in value. However, this year, cryptocurrencies have been under Read More

Mixed Trick or Treat Bag for US Retailers this Halloween

Jharonne Martis, Director of Consumer Research, Refinitiv comments:

“Compared to last year, there is more Halloween merchandise on sale this year.  Although Halloween sales are expected to be lower compared to previous years, strength in other business segments will help offset weakness at stores like, Michaels Stores and Hershey’s.  What’s more, the strong demand for home-related merchandise is helping Michaels Stores post a robust 50.3% earnings growth for the quarter.  On the other hand, Party City might not fare as well.”

  • Average discount penetration [penetration of Halloween-related merchandise on sale] up compared YoY

US Retailers this Halloween

  • However, average discount lower this year going into the holiday weekend as retailers try not to hurt margins
    • Coincidentally, costumes and home décor are the top 2 items Americans intend to purchase for Halloween 2020
    • National Retail Federation says total Halloween spending expected to be $8.0bn this year compared to $8.8bn in 2019

US Retailers this Halloween

3 Companies Banking on Halloween: Michaels, Party City, Hershey

Michaels

  • Recently announced its new transformation plan due to Covid, aimed at improving its omnichannel offering and store operations
  • Analysts polled at Refinitiv - bullish on their Q3 performance (includes Halloween sales)
  • StarMine Analysts Revision Model (ARM) - scored 96 out of 100 - suggests analysts likely to revise earnings estimates upward
  • Benefitted from consumers ‘nesting theme’ in Q3 - expecting 50.53% growth in earnings and 13.9% growth in revenue
  • StarMine Earnings Quality Score of 98 suggests earnings coming from sustainable sources

Party City

  • Analysts polled by Refinitiv agree, Covid-19’s restrictions on gatherings are making Party City’s Halloween sales look spookier this year
  • Credit Risk SmartRatios Model score is weak - 1 out of 100

US Retailers this Halloween

Hershey Co

  • Analysts polled by Refinitiv see upside on the company’s investment in its e-commerce presence and pricing
    • Q4 earnings are expected to show a 7.8% growth
  • StarMine Earnings Quality Score for Hershey is 84 - suggests cash flow and operating efficiency levels look healthy
  • Credit Risk SmartRatio score suggests its leverage ratios could use some improving
  • Credit Structural Model score of 84 - suggests the company is unlikely to default on its debt obligation over the next one-year period

Sources: Data/Charts - “Refinitiv

Commentary - “Jharonne Martis, Director of Consumer Research, Refinitiv

Updated on

Refinitiv, formerly the Financial & Risk business of Thomson Reuters, is one of the world’s largest providers of financial markets data and infrastructure. Serving more than 40,000 institutions in over 190 countries, we provide information, insights, and technology that drive innovation and performance in global markets. Our 160-year Reuters heritage of integrity enables customers to make critical decisions with confidence, while our unique open platform, best-in-class data, and cutting-edge technology bring greater opportunity to our customers. By advancing our customers, we drive progress for the entire financial community. For more information, go to www.refinitiv.com.
Previous article Digital Banking Challenges: Where Will The Next Curveball Come From?
Next article 12 Years On From The Bitcoin Whitepaper, We Continue To Face New Challenges

No posts to display