Zacks Analyst Blog Highlights: Ford, Toyota, Best Buy, Bed Bath & Beyond and Walgreen

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CHICAGO--(BUSINESS WIRE)--Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ford (NYSE: F), Toyota (NYSE: TM), Best Buy (NYSE: BBY), Bed Bath & Beyond (Nasdaq: BBBY) and Walgreen (NYSE: WAG).

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Here are highlights from Thursday’s Analyst Blog:

Retail Sales Turning Tail

The government auto sales numbers (up 2.4% from June, following a 1.9% increase the previous month) were well below what was indicated by the unit sales numbers coming from auto companies like Ford (NYSE: F), General Motors and Toyota (NYSE: TM). However, the "Cash for Clunkers" surge was right at the end of the month, and some of those sales may show up in the August numbers.

The ex-auto sales are the most disappointing, and show that consumers are still keeping their wallets shut pretty tight. The auto sales part is clearly going to be distorted by the Cash for Clunkers program, both in the July data and the August data. The rest of retail sales have no such distortions.

On a year-over-year basis, total sales were down 8.3% vs. being down 8.9% year over year in June. This is all due to a huge swing in autos, which were down 7.3% in July from a year ago versus being down 14.3% year over year in June. Excluding autos, the year-over-year decline actually accelerated to -8.5% from -7.8%.

As might be expected, the more discretionary the store type, the worse sales are doing. This is particularly noticeable on a year-over-year basis. The one exception to that is gas stations, which is pretty much of a non-discretionary store type, where sales were down 2.1% on the month and off 32.5% year over year.

Keep in mind, though, that the retail sales numbers are nominal -- not adjusted for price changes -- and so the decline there has much more to do with prices than it does with volume.

Electronics and appliance store sales were down 1.4% on the month and off 14.6% year over year. The year-over-year numbers reflect Circuit City no longer being in the picture, but the month to month figures are not affected by it. This is probably not a good sign for Best Buy (NYSE: BBY).

Home furnishing stores (including furniture) were down 0.9% for the month and off 12.9% year over year. Similar to the situation with electronics, the removal of Linens & Things probably affected the year-over-year numbers but not the monthly figures, so it is not a good sign for Bed Bath & Beyond (Nasdaq: BBBY). Of course, Best Buy and Bed Bath probably benefited greatly by the removal of major competitors, and these numbers only reflect what is going on at the top line. Firms have been quite successful at cutting costs to offset weak revenues of late.

By comparison, the stores that focus on staples have not seen large declines. Grocery store sales were down by 0.3% for the month but just off 1.1% on a year-over-year basis, and drug store sales were actually up 0.7% for the month and 4.1% year over year. This most likely means that revenues will hold up well at firms like Walgreen (NYSE: WAG).

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