This much has become clear from visiting over 60 stores in the last 24 hours: Black Friday is alive, and so is the U.S. economy.
As for whether I am alive, well, that is a different issue. I am smack in the middle of doing a 48-hour straight live coverage of Black Friday for TheStreet (hope you are watching the blog on the homepage), and am typing this quick piece from a car filled of Red Bull in a mall parking lot. Today, you are very likely to hear that Black Friday in the traditional sense is dead as cheap, cautious spending people avoid the crowds and seek out deals online. There is some early data to support the view.
Channel Advisor, a retail data compiler for some of the largest online shops, said its clients reported same-store online sales were up by more than 50% from midnight to noon on Thanksgiving. Sales on Amazon.com (AMZN) -- which is a holding of the Growth Seeker portfolio -- spiked 31% during that span (told you last week Amazon would own the season). Adobe, which monitors 4,500 U.S. e-commerce sites, reported that as of 11 a.m. Eastern on Thanksgiving, online sales for retailers were up 24%, reaching the $500 million mark. These are huge numbers, and naturally reinforce my long-term bullishness on Action Alerts PLUS portfolio holding Apple (AAPL), seeing as the latest iPhones were likely the device of choice to surf and buy online from one's couch.
While I don't completely disagree that Black Friday has changed thanks to the rise of online buying, what I have seen so far is still considerable interest in braving the crowds. And more importantly for this year, those crowds at many retailers seemed to be stronger than one year ago, according to years of notes I have compiled. Nice economic sign right there, for sure. People did not just come to shop the deals in the circulars, they wanted to splurge a bit on a product that was being offered at a compelling price point, even if it wasn't a door-buster.
Here are several quick takeaways from the madness. Be sure to stay glued to my Twitter feed @BrianSozzi today for the latest from the malls and stores, as well as multiple high-profile CEO interviews.
- Best Buy (BBY): lines significantly longer for Best Buy store opens across the country. Top sections shopped were high-definition TVs and believe it or not, the Microsoft (MSFT) shop. Apple Watch still in stock in stores checked (not a positive sign). Impressive start for the company, I believe. According to Best Buy, it will not be issuing comments on how it began the season, continuing a theme to isolate itself from media. No worries for me, I simply talked to Best Buy's store associates to receive information. Thanks Blue Shirts!
- Sears (SHLD): I have vowed not to enter a single Sears store for the remainder of Black Friday coverage, the stores are that depressing. They are empty, discounts are elevated, and the selection awful compared to what J.C. Penney (JCP) and Macy's (M) have brought to the table. I think Sears, coming as no surprise, is fully prepared to have a disastrous holiday season as it cedes serious shares to competitors. Execs should be embarrassed with how Sears stores look and feel. Earnings out on Dec. 30. Don't expect any comments on how the holidays have started.
- Foot Locker (FL): I stand by my view the company will be a holiday season winner. The company wasn't offering juicy door-buster deals, yet people lined up at the store's open to buy all things Nike (NKE). Crowds stayed stronger than Finish Line into the night.
- Dick's Sporting Goods (DKS): Disappointing door-buster promotions and sparse traffic. I think the company may have lost share at the start of Black Friday to department stores aggressively marking down winter coats and athletic wear.
- Wal-Mart (WMT) and Target (TGT): general theme at both retailers was that stores didn't feel as packed as normal for a Thanksgiving opening. I think department stores Macy's and J.C. Penney, and Best Buy, nailed their opens, thieving business from both companies.
- Coach (COH)/Michael Kors (KORS): way too promotional for my liking, especially Michael Kors. Continue to believe it's hard to get long these names given the pressure on gross margins.
- J.C. Penney: won the start of Black Friday, hands down. Was very, very impressed by the assortment and door-buster promotions. Traffic surged at the openings, and continued to flow in well past midnight.
- Toy category: if you are long Disney (DIS) or Hasbro (HAS), I would pay careful attention on whether Star Wars inventory is sold out. In my checks at Target and Toys R'Us, was rather surprised Star Wars stuff was not out of stock. It could be a case of Force Friday sales in September shifting demand, or there are too many items out there for the market to absorb.
- Abercrombie & Fitch (ANF): another winner for the start of Black Friday. The company came out swinging with 50% off the entire store promotions at the ANF and Hollister divisions, and crowds showed up in droves. The selection was strong. Abercrombie continues to have success with these types of eye-popping promotions, and I think implementing them for Black Friday paid dividends. The company is not commenting on how its season has begun, also continuing to isolate itself from media like Best Buy.
- DAVIDsTEA (DTEA): Newly minted public company was not opened on Thanksgiving Day, whereas Starbucks (SBUX)-owned Teavana was open. Missed opportunity for DAVIDsTEA -- tea gift set purchases are a one and done thing.
- V.F. Corp (VFC): Sure, was odd to see North Fleece jackets and fleeces being offered on door-buster promotions. Thank you, Mother Nature. Not a great sign for how the fourth quarter has started for the apparel manufacturer.