* Economic worries trump robust U.S. weekend sales
* Holiday season still has weeks to go
* Many retailers' shares down; Deckers up
(Adds closing stock activity)
By Martinne Geller and Phil Wahba
NEW YORK, Nov 26 Investors shrugged off images
of massive lines at stores over the four-day Thanksgiving
weekend and focused on concerns that any strength at the
traditional kickoff of the holiday shopping season will be
fleeting, sending many retailers' shares down on Monday.
The National Retail Federation said sales for the four days
from Thanksgiving to Sunday rose 12.8 percent from the same
period last year, well above the 4.1 percent gain the trade
group expects for the whole season.
Still, the S&P 500 Retail Index closed down 0.22
percent, in line with the broader market, weakened in part by
concerns about the eurozone and negotiations in Washington to
avoid the U.S. "fiscal cliff," which could lead to higher taxes
Investors were concerned that strong sales initially might
just mean less business later in the season.
"Nothing has changed materially with the economy or the
consumer," said Walter Stackow, portfolio manager with Manning &
Napier, which invests in retail stocks. "It's fair to be
skeptical and think: 'We rearranged the deck chairs and pulled
some sales forward.'"
Stackow called the NRF's numbers, which are projections
based on consumer surveys, "out of whack" with sales trends in
recent months that have been limited by persistent unemployment.
Investors will give more weight to November sales data that
major chains such as Macy's Inc, Target Inc and
Costco Wholesale Corp plan to report this week.
Analysts are expecting an average increase of 3.3 percent in
sales at stores open at least a year for November, excluding
drugstores, according to Thomson Reuters I/B/E/S. Before the
weekend, they expected a gain of 3.1 percent.
But even that data is only a small snapshot of only 17
chains. Many of the largest retailers, including Wal-Mart Stores
Inc, Toys R Us, online leader Amazon.com Inc
and Best Buy Co Inc, the largest electronics specialty
retailer, do not report monthly sales figures.
Analysts and investors caution against reading too much into
one weekend's numbers, especially since four of the five busiest
shopping days of the season will come in the 10 days leading up
to Christmas Day, according to ShopperTrak.
"It's sort of like the Super Bowl. The first couple of plays
have been played, but we still do have a whole game ahead of
us," said Shawn Kravetz, president of Esplanade Capital, which
invests in retail stocks.
The Thanksgiving weekend typically accounts for 16 percent
to 19 percent of total holiday sales, said Barclays analyst Alan
WALMART THE WINNER
Still, sales over Thanksgiving weekend and the holidays in
general are closely watched as consumer spending accounts for
about 70 percent of all economic activity. Retailers can
generate a third of their sales and up to half of their annual
profit in November and December.
Deutsche Bank analyst Charles Grom said Wal-Mart was once
again "crowned the overall Black Friday winner," with strong
sales of electronics and Furby toys.
Still, the shares of Wal-Mart and Macy's Inc were
among the retail stocks that fell on Monday, despite a good
weekend, because investors see the stocks as proxies for the
overall economy, said Morningstar analyst Paul Swinand.
The shares of Coach Inc, Ann Inc, Target
Corp were also down.
One of the worst-performing retail stocks on Monday was
Aeropostale Inc, whose shares closed 4.7 percent lower
after it was downgraded by Janney Capital Markets analyst
Adrienne Tennant, who cited increased competition from
Abercrombie & Fitch Co and American Eagle Outfitters Inc
Aeropostale was offering deeper discounts over the weekend
than its two main rivals.
Oppenheimer analyst Pamela Quintiliano said Ann, which
specializes in women's clothing, "may potentially prove to be
the most disappointing as traffic never fully materialized on
stable promotions" over the long weekend. The company's shares
closed down 3.7 percent on Monday.
UBS analyst Roxanne Meyer said specialty retailers with
strong foot traffic included Limited Brands Inc,
American Eagle and Gap Inc, with relatively weaker
traffic at Aeropostale, Cold Water Creek Inc and
Chico's FAS Inc.
Another stand-out was Deckers Outdoor Corp, whose
shares rose 6.6 percent. Wedbush Securities raised its price
target on Deckers, saying cooler weather over the weekend helped
sales of its UGG boots.
The shares were also buoyed by a media report discussing the
company as a possible takeover target. Esplanade's Kravetz
called such speculation about Deckers, whose stock fell 68
percent in the last 12 months, "legitimate but possibly
premature." He said he could envision a takeover in the medium
A Deckers spokeswoman was not immediately available to
comment on the report.
(Reporting by Martinne Geller and Phil Wahba in New York;
Editing by Lisa Von Ahn, Tim Dobbyn and Andre Grenon)