Holiday shoppers pay up as promotions fade: SW Retail’s Stacey Widlitz

Frank Holland (Anchor) 00:00.070

all right stacey we got a bunch of stats from our all american survey i want to bounce off you but first i want to ask because i was personally in a store yesterday picking up a last minute gift what companies benefit from the last minute urge to shop or people trying to just

Frank Holland (Anchor) 00:11.830

fulfill their wish list or their stocking stuffers which companies like really see that last minute boost

Stacey Widlitz (President) 00:17.750

that's a great question and it is at the last minute everybody 's in a panic and what can i get that small that's maybe not a huge ticket item so that's ulta that's a T J X that's of course home goods if you have last minute things to spruce up your house and you have guests

Stacey Widlitz (President) 00:32.950

coming over and of course that's walmart because all the last minute items that you need to feed all the guests coming over so those are the kind of the the impulse pickups and you know again of course for women teens that extra lipstick or whatever it is from from ulta all

Stacey Widlitz (President) 00:50.910

right

Frank Holland (Anchor) 00:51.110

i'm gonna use a word that we use a lot here bifurcation because we're seeing a bifurcation between what we're hearing from the NRF trillion dollar holiday shopping season and what we're seeing from surveys i just want to bounce this off you sixty percent of people say they're

Frank Holland (Anchor) 01:01.630

going to spend less on others forty six percent of people say they're going to spend less on themselves you can see the other stats here basically people keep saying they're going to spend less so then how is the estimate going up when the sentiment is this bad and and who

Frank Holland (Anchor) 01:13.910

benefits from this bad sentiment but apparent willingness to keep on ending

Stacey Widlitz (President) 01:19.070

and and frank it's so interesting so the consumer is always saying oh they're cautious all every CEO we've heard from that reported Q three earnings the consumers cautious there's a bifurcation yet the consumers out there and they're spending and they're spending on full price

Stacey Widlitz (President) 01:31.830

because what we know is that there are fewer discounts out there certainly retailers are holding back on discounts and increasing prices as tariffs really the impact starts rolling in don't forget Q one of next year that's when the cost of goods priest is really going to hit us

Stacey Widlitz (President) 01:49.830

so certainly you hear the consumers cautious but what we've seen is there's a lot of full price selling so that's across the board you've seen a a nice rebound in urban outfitters hollister comps or a heavy double digits there's so many retailers out there that are are reporting

Stacey Widlitz (President) 02:07.590

that their margins are incredibly strong despite all the noise we hear yeah

Frank Holland (Anchor) 02:12.350

you hear it cautious a lot also i think some ceos got a thesaurus you also hear choice vault i don't know where that one came from yeah

Stacey Widlitz (President) 02:17.830

exactly we love those buzzwords alright i want to get to a stock that you're actually bullish on i think a lot of people are out on but you're bullish on nike you just upgraded it to buy you had it to sell for a couple years i think what are you seeing because that report didn't

Stacey Widlitz (President) 02:30.030

get a lot of other people excited weakness in china a lot of questions about competition from hoka and on brands what are you seeing in this companies is it tied to the holiday season or is there some other narrative

Stacey Widlitz (President) 02:39.910

so i think what's really going on is that we had this time period several years where nike was discounting more and certainly their margins are under pressure it degraded their brand and it was the onslaught right of all those brands you just talked about three to six months is

Stacey Widlitz (President) 02:57.640

all of a sudden apparel they're really pulling back on discounts so margin accretive there and the brand is starting to creep back in and compete again it is going to take some time and certainly in the Q three print that we saw china was a train wreck and that's really the

Stacey Widlitz (President) 03:12.640

issue north america was a bit better so i think there's a nice glide path here on the margin side and once we clean up the china market you know i think a lot of

Frank Holland (Anchor) 03:23.040

people say you have a lot of holiday cheer stacey look at this company it's about thirty percent off it's fifty two week high so it's certainly down quite a bit alright last question for you what's the real story on discounting are we seeing discounting comparable to last year

Frank Holland (Anchor) 03:36.430

less or more and what does that say about the strength of retailers and also their inventory holdings going into the new year