Retail Industry Showing Strength in 2013 as Commerce Department Reports 1.1% Increase in February Sales
Five Star Equities Provides Stock Research on American Eagle Outfitters and Urban Outfitters
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 American Eagle Outfitters (NYSE: AEO) and Urban Outfitters, Inc. (NASDAQ: URBN).
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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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American Eagle Outfitters operates more than 1,000 stores in North America, and ships to 81 countries worldwide through its websites. American Eagle Outfitters and Aerie merchandise also is available at approximately 54 international franchise stores in 14 countries. The company reported revenues for fiscal 2012 increased 11 percent to a record $3.48 billion.
Urban Outfitters is a lifestyle specialty retail company, which operates under the Urban Outfitters, Anthropologie, Free People, Terrain and BHLDN brands. The company has recently reported operating profit for the fourth quarter of 2012 surged 104 percent year-over-year. Shares of Urban Outfitters have gained approximately 5.5 percent in 2013.
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