NEW YORK, NY -- (Marketwire) -- 03/14/13 -- Retail stocks received a boost Wednesday after a report released Tuesday showed U.S. retail sales in February posted its biggest gain in 5 months. The sharp rise comes as a welcome sign as it shows the consumer is gaining confidence in the U.S. economy despite higher taxes in 2013. Five Star Equities examines the outlook for companies in the Retail Industry and provides equity research on Abercrombie & Fitch Co. (NYSE: ANF) and NIKE, Inc. (NYSE: NKE).
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The Commerce Department reported retail sales in February increased 1.1% to a seasonally adjusted $421.40 billion, which was the fourth consecutive month of gains. When compared to a year ago sales increased 4.6 percent. Additionally, the Commerce Department reported U.S. business inventories in January grew by 1 percent, the most since May 2011. The increase in inventories suggests companies expect demand to pick up in the months to come.
"This all suggests that the hit to spending from the payroll tax cut and higher gasoline prices, which reduce the amount of cash available to spend on other items, hasn't been too bad," said Paul Dales, senior U.S. economist at Capital Economics. "The recent pickup in both employment and earnings growth bodes well for consumption growth later in the year, too."
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Abercrombie & Fitch Co., through its subsidiaries, operates as a specialty retailer of casual apparel for men, women, and kids. At the end of Fiscal 2012, the Company operated a total of 1,051 stores. The company reported record sales of $1.469 billion for the fourth quarter of 2012, an increase of 11 percent when compared to a year ago.
NIKE is the world's leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. The company has declared a quarterly dividend of $0.22 per share, for a dividend yield of approximately 1.53 percent. Shares of Nike have gained roughly 6 percent year-to-date.
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