Retailers, consumers and prices
Check out the latest encouraging news about U.S. shoppers dusting themselves off and shelling out their hard earned cash again.
U.S. consumers spent more in February than expected, despite buying fewer cars and being stuck at home shoveling record amounts of snow in many parts of the country. The U.S. Commerce Department said on Friday that total retail sales rose 0.3 percent, from necessities to luxury items. Excluding motor vehicles and parts, retail sales rose a bigger than expected 0.8 percent in February.
This comes on top of better than expected February sales reported last week at many top U.S. retail chains.
And more improvement is yet to come as U.S. consumers pay off debt and fix their collective balance sheets, freeing up more cash to go shopping, according to a Wall Street Journal report this morning.
Check out how a little debt can help that bottom line.
Pier 1 posted a profit on Thursday, even though sales fell 9 percent overall and 7.5 percent at stores open at least a year.
How’d they do it? Well, recording a $48 million gain on the repurchase of debt was surely a help. Even excluding that gain, the loss per share topped analysts’ forecasts. Inventory was down a bit and while sales fell, the decline was smaller than Wall Street anticipated.
Why do this? The Wall Street Journal offers some possibilities:
“Sounds like Moody’s may be trying to get out in front on defaults, given they were perhaps a little behind on subprime mortgages and commercial mortgage-backed securities,” said David Resnick, managing director at investment banking firm Rothschild Inc. which works on many corporate bankruptcies and restructurings.