Facts from the Week: February 6, 2022
Highlights from $MA $V $COST $AXP $VAC $BOOT $SBUX $TUEM $MTH $MTH $CCS $FLXS $WHR $ETD $BSET $RHI $TBI Indeed $HOOD $IBKR Consumer Housing Financial
Summary
Consumer spending in January has been strong according to Mastercard, Visa, Boot Barn, and Costco
American Express notes an uptick in travel bookings in January
Labor demand remains high as noted by Robert Half, True Blue, and Indeed; Starbucks is raising average hourly wage to $17 this summer
Consumer
Mastercard - $MA
Visa - $V
Costco - $COST - January Sales
US two-year comp ex gas/fx +27.5%, 370bps better than December
two year ecomm growth +114% vs +79% in December
US traffic +7.5% yoy
inflation in Jan consistent with Dec, which was consistent with Nov, which moderated relative to Oct
gas price+42%
American Express - $AXP
You've got historically high billings growth. We haven't gotten into this, but we see travel bookings. When we looked at travel bookings in the fourth quarter, it was 24% up over '19. When we look at the first couple of weeks in January, we're 44% up over '19. So we have tremendous momentum entering 2022 -CFO
Marriott Vacation Club - $VAC
"We ended the year strong, with contract sales above the high-end of our previous guidance range," said Stephen P. Weisz, chief executive officer. "While we have seen a modest impact in January related to Omicron, forward looking trends remain strong, illustrating the resiliency of our leisure-focused business model."
Boot Barn - $BOOT
Our fourth quarter is off to a strong start with consolidated sales growth on a 2-year basis through the first 4 weeks increasing 89%. This not only represents a sequential improvement from the incredibly strong results in the third quarter that has extended the trend to 45 consecutive weeks of more than 55% sales growth on a 2-year basis. These sales continue to be driven by increases in transactions coupled with a strong expansion in merchandise margin. January sales growth has been broad-based across all merchandise categories and geographies.
While we try not to get people hung up on this, we are seeing a resurgence in the oil markets, right? Our West Texas business has turned positive. Our flame-resistant work apparel business has turned positive. So there's plenty of places for us to get continued growth. And again, it's a little bit too early to say whether we'll give it back what we've gotten this year. -CEO
Starbucks - $SBUX
In terms of quarterly margin and EPS cadence, we expect headwinds to intensify in Q2 as Omicron disruptions escalated in January. While the intensity throughout Q2 is unknown, we expect Q2 quarterly non-GAAP EPS and margin to be below prior year levels, with significant improvement in Q3 coming from our margin enhancement actions materializing. Q4 is then expected to show continued recovery but at a more gradual pace, inclusive of the summer step-up in wage investments as we raise the U.S. average store hourly wage to $17. Assuming no other significant impacts, including further impacts from COVID, we anticipate our EPS to return to double-digit growth in fiscal '23 and beyond. -CFO
Tuesday Morning - $TUEM
While we will not develop a habit of talking about monthly sales performance, much has been said across the retail sector about sales softness starting in December due to the Omicron variant and continuing into January as we lapped last year's stimulus. We were not immune to this as we were operating in line with our plan through November and started to see softness during December week 2. It appeared we were coming out of peak Omicron disruption in January week 2 and then various weather-related events occurred. As of now, we are projecting mid-single-digit comp sales growth for the third quarter as compared to fiscal 2021.
Housing
Meritage Homes - $MTH
“The housing market remained strong, benefiting from the ongoing shortage of housing inventory, still-low interest rates and the continued favorable homebuying trends from millennials and baby boomers that drove housing demand in all our markets.” -CEO
Century Communities - $CCS
In December, the FHA announced they would increase their loan limits across 99% of U.S. counties, which will help support continued affordability for our first-time and move-up homebuyers in 2022. The new FHA loan limits went into effect on January 1 and increased by approximately 18% basically equivalent to the rise in home prices that occurred over the past year. -CEO
This strong demand environment is further evidenced by the significant progress made in growing our backlog, ending the year with 4,651 sold homes valued at $1.9 billion, increases of 35% and 45%, respectively.
Beazer Homes - $BZH
The new home market continues to be characterized by strong demand and limited supply, supported by growth in both employment and wages. Given this backdrop, the strength in our first quarter results and the visibility we have into our backlog, we are confident our full-year results will exceed our previously communicated target of $5.00 despite continuing industry-wide challenges in labor and material availability. -CEO
Flexsteel - $FLXS
“Despite delivering strong sales growth of 18.9% during the quarter, profit results were hampered by continued supply chain disruptions and swelling logistics costs. We are competing well and gaining market share as demonstrated by our six consecutive quarters of double-digit sales growth. We intend to continue this momentum and expect sales in our fiscal third quarter to grow in the range of 14% to 22%.” - CEO
Whirlpool - $WHR
Ethan Allen - $ETD
While our retail written orders were flat to the second quarter last year, orders were up 45% from 2 years ago. Similarly, wholesale segment written orders were up 1.7% to last year but up 30% compared to the second quarter of fiscal 2020. Our order backlogs at December 31 are approximately 50% higher than a year ago, but becoming more current, and we expect to get caught up during calendar 2022.
Retail net sales were up 24% and wholesale net sales increased 14.2%.
While expanded production combined with higher import receipts led to a reduction in retail order backlog during the first half of fiscal 2022, backlog is still up almost 50% from a year ago due to sustained product demand.
Bassett Furniture - $BSET
we ended the year with a wholesale backlog of $90.1 million compared to $54.9 million in 2020 and $20.0 million in 2019. Raw material stock outages have improved somewhat since the end of November, making way for further reduction of the wholesale backlog to start 2022.
Labor
Robert Half - $RHI
Our temporary and consultant staffing divisions exited the fourth quarter with December revenues up 31% versus the prior year, compared to 32% increase for the full quarter. Revenues in the first 2 weeks of January were up 40.2%, compared to the same period 1 year ago.
Permanent placement revenues in December were up 73% versus December 2020. This compares to 74% increase for the full quarter. For the first 3 weeks of January, permanent placement revenues were up 51.7% compared to the same period in 2021.
True Blue - $TBI
Total revenue for Q4 2021 was $622 million, representing growth of 20%, compared to Q4 2020, and growth of 5%, compared to Q4 2019. This growth was driven by strong results at PeopleReady and PeopleScout. Strong overall demand, particularly in the retail sector, along with improvements in worker supply, drove the PeopleReady results. -CFO
Indeed.com
Financial
Robin Hood - $HOOD
Monthly Active Users (MAU) increased 48% to 17.3 million for December 2021, compared with 11.7 million for December 2020. On a sequential basis, MAU decreased 8% compared with 18.9 million for September 2021.
For the first quarter of 2022, Robinhood anticipates that total net revenues will be less than $340 million, which assumes some incremental improvement in trading volumes versus what we have seen so far. At the top end, this implies a year-over-year revenue decline of 35% compared to the first quarter of 2021, during which we saw outsized revenue performance due to heightened trading activity, particularly relating to certain meme-stocks.
Interactive Brokers - $IBKR - January 2022 results
Odds and Ends
AAII Bull Bear
US Federal Reserve Balance Sheet
Thanks for reading and enjoy your Sunday!