Major Retailers Report Skyrocketing Sales, Even At Physical Stores
Even as many major retailers contract or fold, a winning few report higher sales. On Tuesday, Target Corp. said that its 2020 sales were up by more than $15B, the most that metric has grown for the company in more than a decade.
Target's revenue grew 21% in the fourth quarter of 2020 to $28.34B, up from $23.4B for the same period in 2019. The Q4 2020 figure beat analysts’ expectations of more than $27.4B.
The retail giant benefited especially from an uptick in grocery sales during the coronavirus pandemic, but sales in most of Target's lines of merchandise were up. Comparable sales grew 20.5% year-over-year in Q4 2020, reflecting comp traffic growth of 6.5% and a 13.1% increase in average ticket, according to the company.
Comp sales at physical Target stores increased 6.9%, but that growth was dwarfed by digital comparable sales, which grew 118%, accounting for two-thirds of the company's comp sales growth.
Sales continued to be strong for Target in January as consumers received their stimulus payments.
“January was a really surprising month for me,” Target CEO Brian Cornell told CNBC’s Squawk Box on Tuesday. “I think if I do this for another 20 years, we’re unlikely to see January comps grow at a rate of over 30%.”
Kohl's Corp. also beat expectations for the fourth quarter, reporting on Tuesday that its net income for Q4 came in at $343M, compared with $265M a year earlier.
"Our fourth quarter performance exceeded our expectations across all key metrics, with sales strengthening as we moved through the period," Kohl's CEO Michelle Gass said in a statement. "Digital sales growth remained strong, up more than 20%, and accounted for more than 40% of net sales, with our stores playing a critical role in supporting the heightened demand."
Another major retailer has done well enough lately to attract the attention of private equity suitors. Apollo Global Management and at least one firm have expressed interest in buying hobby and crafts specialist Michaels, The New York Times reports, citing sources familiar with the situation.
The pandemic trend of people staying home to pursue their hobbies has been good to Michaels. The craft goods retailer will release its Q4 2020 results on Thursday, but for Q3 2020, it reported a year-over-year net sales increase of 15.1% to about $1.4B. Comparable store sales increased 16.3%, including e-commerce growth of 128% compared with a year earlier.