Companies and Subjects discussed in this morning's report include: Ross outcomps TJX's Marmaxx by a huge margin, BJ's narrows the comp gap with Costco and Sam's, Somnigroup is closer to closing Leggett & Platt acquisition, Buckle reports a solid, not great quarter, Marquee Brands buying Canada's Roots...
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DoR Consumer Research
Investor Oriented | Retail & Consumer
Friday, August 21, 2026 | Published Daily by ~11:30 AM ET
Ross Outcomps Marmaxx by Big Margin, BJ's Narrows Comp Gap with Costco and Sam's...
NEXT WEEK'S CALENDAR
UPDATED EACH MORNING
All Times Are Eastern
Monday (8/24)
- DoRCR publishes its proprietary weekly Store Opening/Closing Analysis
Tuesday (8/25)
- Dick's Sporting Goods reports 2Q26, call 8:00 am, Street at comps/EPS of +4.1%/$3.77
- Citi Trends reports 2Q26, call 9:00 am, Street at comps up 10.5%, EPS of ($0.32)
- Consumer Confidence for August at 10:00 am, Street at 90.1 vs. prior 90.8
- New Home Sales for July at 10:00 am, Street at 621K SAAR vs. prior 628K
Wednesday (8/26)
- Personal Income/Spend for July at 8:30 am, St at +0.2%/+0.2% m/m, prior +0.3%/+0.2%
- Abercrombie & Fitch reports 2Q26, call 8:30 am, Street at comps up 0.8%, EPS of $1.99
- Bath & Body Works reports 2Q26, call 8:30 am, Street at comps/EPS of (3.9%)/$0.24
- Kohl's reports 2Q26, call 9:00 am, Street at comps down 0.6%, EPS of $0.58
- Williams-Sonoma reports 2Q26, call 10:00 am, Street at comps up 4.5%, EPS of $2.08
- Urban Outfitters reports 2Q27, call 5:00 pm, Street at comps up 5.8%, EPS of $1.72
Thursday (8/27)
- Dollar Tree reports 2Q26, call 8:00 am, Street at comps up 3.2%, EPS of $1.14
- Best Buy reports 2Q27 call 8:00 am, Street at comps up 1.3%, EPS of $1.37
- Jobless Claims for the week ended 8/22/26 at 8:30 am, no Street estimate yet, prior 206K
- Burlington reports 2Q26, call 8:30 am, Street at comps up 2.9%, EPS of $2.19
- Dollar General reports 2Q26, call 9:00 am, Street at comps up 2.6%, EPS of $2.01
- Build-A-Bear reports 2Q26, call 9:00 am, Street at sales/EPS of $120.8M/$0.65
- Ulta Beauty reports 2Q26, call 4:30 pm, Street at comps up 2.3%, EPS of $6.19
- Gap reports 2Q26, call 5:00 pm, Street at comps up 0.2%, EPS of $0.48
Friday (8/28)
- DoRCR publishes its proprietary Next Week's Calendar
- U. Mich. Sentiment for August (final) at 10:00 am, Street at 50.2 vs. prior 51.0
**Colors Indicate Directional Change from First Time Shown in Our Calendar**
TODAY'S EARLY TRADING
The S&P Retail ETF (XRT) is up 0.8% as of ~10:45 am vs. a 0.6% gain in the S&P 500. Retail stocks are outperforming after beat-and-raise 2Q26 results from Ross Stores and BJ's Wholesale Club.
- Stronger retail stocks include BKE, which is up 5% after second quarter results, also VNCE (up 4%), RENT (up 4%), ROST (up 4%) and BIRK (up 4%).
- Weaker retail stocks include BABA, which is down 7% after results, also LVLU (down 4%), REAL (down 4%), CATO (down 3%) and JILL (down 3%).
MARKET-MOVING DEVELOPMENTS
All Stock Prices as of Last Close
- The +10% comp was on top of +2% last year and above the Street's +7.7% estimate and follows +17% in the first quarter, when Ross (and others) got a lift from higher tax refunds, while total sales grew 13% to $6.26B on the comp and continued new store growth.
- The +10% comp was consistent through the quarter and driven primarily by customer traffic, which was driven by strong merchandising and compelling value, effective marketing, including via social media, and ongoing improvements to the in-store experience.
- Excluding a $0.60 per share benefit from tariff refunds, EPS were $2.06 vs. $1.56 last year and the Street's $1.95 and incorporated 205 bps of operating margin improvement.
- Ending inventories were up 18% y/y and reflect the strong growth in traffic and strategic efforts to broaden the merchandise assortment to leverage the higher traffic.
- Ross opened 47 new stores in the quarter, including 35 Ross Dress for Less stores and 12 dd's DISCOUNTS, has ~2,330 stores currently, and is now planning to open 115 stores this year, up from a prior 110 and including 90 Ross stores (up five) and 25 dd's (unchanged).
- Management raised guidance for 2H26 and now expects comps of +6%-7% in the third quarter and +4%-5% in the fourth against more difficult comparisons of +7% and +9%, while full-year EPS ex tariff refunds are now expected at $8.01-$8.17 vs. $6.61 last year.
- Full-year guidance also assumes $1.275B in stock repurchase, same as before.
- DoRCR INSIGHT: Ross and the off-price sector in general remain in a real sweet spot with consumers looking for value amid macro and geopolitical uncertainty and persistent inflation in some areas and as global retail continues to experience tariff/trade-related dislocation, which in turn leads to even better merchandise buying opportunities for the group.
- The +3.1% comp is better than the Street's +2.6% and not far from Sam's Club, which comped up 4.4%, though it's about half where Costco has been trending on a monthly basis.
- Total sales grew 16% y/y to $6.09B, and membership fee income grew 10% to $135.6M on new members and high retention -- BJ's now has a record 8.5M members -- also an increase in higher-tier membership penetration across both new and existing clubs.
- Other revenue callouts: Digitally-enabled comps were +30% on top of +34% last year.
- Adjusted EPS were $1.36 vs. $1.14 last year and the Street's $1.17 and incorporated a 20 bps decrease in merchandise gross margin rate after a 10 bps decline in 1Q26.
- Full-year guidance still includes ex-fuel comps up 2%-3%, while adjusted EPS are now expected at $4.60-$4.80 vs. $4.40 in FY25 and a prior range of $4.40-$4.60.
- DoRCR INSIGHT: We like the BJ story for its differentiation (greater fresh food focus) within the dynamic US warehouse club industry and the significant white space for new clubs, and it's good to see the relative comp underperformance vs. Costco and Sam's narrow as BJ's grows into new markets, especially Texas, which is a big longer-term opportunity for the concept.
OTHER DEVELOPMENTS
Somnigroup's (SGI, $64.26) previously announced $2.5B all-stock acquisition of Leggett & Platt (LEG, $9.34), a diversified manufacturer of bedding and other products, has been approved by LEG shareholders and still needs one more regulatory approval before it can close.
The Buckle (BKE, $42.64) reported solid 2Q26 (July) sales consistent with its monthly updates and including comps of +2.1% and total sales of $319.8M, up 5% y/y, while EPS were $0.87 vs. $0.89 in last year's second quarter and above the Street's $0.81 estimate.
- Online sales grew 2% to $44.6M, 13.9% penetration vs. 14.3% last year.
- Gross margin increased 40 bps y/y after a 50 bps decline in the first quarter.
- Ending inventories were up 13% y/y after being up 13% in the first quarter.
- Buckle doesn't give any detail/color in its press releases and doesn't guide.
Walmart CEO John Furner said during its 2Q27 (July) call yesterday the number of customers using Walmart's AI-powered shopping assistant Sparky is up 70% y/y and that those using Sparky are spending 40% more per order than customers who are not using it.
US Video Game hardware spending fell 29% y/y in July, to $395M, and continued to be negatively impacted by the very successful June 2025 launch of the Nintendo Switch 2, though higher hardware prices amid the chip shortage are also causing some consumers to hold back on purchases, while video game accessories spending decreased 6% y/y, to $189M, all acc'd to Circana.
Swiss Watch Exports were strong in July and increased nearly 10% y/y in value, driven in good part by exports to the US, which increased 27%, the third month in a row of double-digit gains, and accounted for nearly 27% share of all exports during the month as higher-end US consumers continue to see a nice wealth effect from the strong stock market.
- The FIFA World Cup was also a factor in the strong US performance in July.
SHEIN (Singapore) has delayed its Hong Kong IPO and now plans to launch the offering at the beginning of next week and list on 9/1/26 acc'd to Reuters, which says the targeted valuation range is $26B-$27B vs. a peak of nearly $100B in a 2022 private funding round.
Marquee Brands will lead an acquisition of Canada's Roots, which trades in Toronto, ticker ROOT, for C$4.10/sh, an 11% premium to yesterday's close and a 36% premium to the 3/2/26 pre-strategic-review price. JM&A Design and Development is partnering with Marquee and will run day-to-day ops, including 100+ NA Roots stores. The deal -- equity value is ~C$160M -- is designed to keep Roots "uniquely Canadian" while expanding distribution globally.
COMMERCIAL REAL ESTATE
BJ's Wholesale, which currently has 267 clubs and 206 gas stations in 22 states, announced plans for another new store in Texas, in Tyler, part of a plan to open 25-30 new clubs every two years.
Carolina Herrera, which is owned by Spain's Puig, has opened its sixth mono-brand store in the US, store size is ~3K square feet, in Miami's Design District.
MANAGEMENT UPDATES
BJ's Wholesale Club Chief Commercial Officer since 2021, company exec since 2020, and former Bain & Company Partner and Frito-Lay exec Paul Cichocki has retired from his current position, effective today, but will serve as a part-time Executive Advisor through the beginning of October, and then on an on-call basis through 4/1/27, at which time he will officially retire from the company.
Groupe Dynamite (Canada, owns GARAGE and DYNAMITE) has hired JD Sports SVP of Digital & Customer Care since 2023 and former Gymshark North America President and former Faherty, Tory Burch, J.Crew and Gap merchandising exec Henry Spear as Chief Customer Officer.
MACRO/CONSUMER INSIGHT
Out yesterday, Jobless Claims for the week ended 8/15/26 were lower than expected at only 206K vs. the Street's 211K estimate and down 6K from a revised 212K the prior week, while Continuing Claims, which are reported with a week's lag, rose by 18K, to 1.80M.
- DoRCR INSIGHT: Reassuring to see another low Jobless Claims number after the weak Nonfarm Payrolls for July report -- down 23K -- supports the "low-hire, low-fire" narrative around the labor market, and with Unemployment at only 4.1%, is positive for consumer spending.
Out Tuesday and acc'd to the U.S. Energy Information Administration, a gallon of regular Unleaded Gasoline cost $4.05 on average across the US for the week ended 8/17/26, up $0.04 from the prior week and up $0.92 per gallon from the same week last year.
- A gallon of diesel cost $5.45, up $0.19 on the week and up $1.74 from last year.
- DoRCR INSIGHT: Gas prices could come down quickly with a US/Iran peace deal and reopening of the Strait of Hormuz, but for now, the significant y/y increase is a meaningful headwind to discretionary spending, esp by lower-income consumers (e.g. core dollar store customer).
Also out Tuesday, Pending Home Sales for July were weaker than expected and fell 2% m/m vs. the Street's estimate and reflected declines across all regions of the country, while Pending Home sales also fell 2% on a year-over-year basis when compared to July 2025.
- DoRCR INSIGHT: High mortgage rates -- the average 30-year fixed rate mortgage was 6.5% in July -- continue to suppress housing turnover, but there are signs of life in some areas of retail more dependent on home sales, including furniture, based on recent reports from Wayfair, which grew US revs by 9% in the second quarter, and Arhaus, which grew comp written sales by 12.5%.
Source: Labor Dept and Bloomberg (for chart)
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