Companies and Subjects discussed in this morning's report include: TJX reports an upside 2Q, but with Marmaxx slowing, Lowe's reports a mixed quarter, with light comps, Target's turnaround continues to gain momentum, La-Z-Boy's wholesale segment drags on performance, Gordon Bros may sell Poundland...
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DoR Consumer Research
Investor Oriented | Retail & Consumer
Wednesday, August 19, 2026 | Published Daily by ~11:30 AM ET
Upside Results from TJX and Target and a Mixed Second Quarter from Lowe's in Focus...
THIS WEEK'S CALENDAR
UPDATED EACH MORNING
All Times Are Eastern
Monday (8/17)
- DoRCR publishes its proprietary weekly Store Opening/Closing Analysis
Tuesday (8/18)
- Amer Sports reports 2Q26, call 8:00 am, Street at sales/EPS of $1.54B/$0.11
- Housing Starts for July at 8:30 am, Street at (6.6%) m/m vs. prior +19.0%
- Home Depot reports 2Q26, call 9:00 am, Street at comps up 0.9%, EPS of $4.73
- Pending Home Sales for July at 10:00 am, Street at +0.2% m/m vs. prior (5.4%)
- La-Z-Boy reports 1Q27 after the close, Street at sales/EPS of $501.4M/$0.49
Wednesday (8/19)
- Revolve meeting with investors in San Francisco, hosted by BTIG
- Target reports 2Q26, call 8:00 am, Street at comps up 2.4%, EPS of $2.34
- La-Z-Boy 1Q27 call at 8:30 am
- Lowe's reports 2Q26, call 9:00 am, Street at comps up 0.5%, EPS of $4.22
- TJX reports 2Q27, call 11:00 am, Street at comps up 3.3%, EPS of $1.19
Thursday (8/20)
- Walmart reports 2Q27, call 8:00 am, Street at comps up 3.8%, EPS of $0.74
- Advance Auto Parts reports 2Q26, call 8:00 am, Street at comps up 1.4%, EPS of $0.81
- Jobless Claims for the week ended 8/15/26 at 8:30 am, Street at 211K vs. prior 209K
- Ross Stores reports 2Q26, call 4:15 pm, Street at comps up 7.7%, EPS of $1.95
Friday (8/21)
- DoRCR publishes its proprietary Next Week's Calendar
- BJ's Wholesale reports 2Q26, call 8:00 am, Street at comps up 2.6%, EPS of $1.17
- The Buckle reports 2Q26, call 10:00 am, actual comps up 2.1%, EPS expected at $0.81
**Colors Indicate Directional Change from First Time Shown in Our Calendar**
DoRCR's RETAIL & CONSUMER WEBINAR
If you weren't able to tune into our inaugural monthly Retail & Consumer Zoom webinar last Wednesday and would like to watch the recording, just click here to view it online, no username or password required. It's ~35 minutes and covers our thoughts on the current macro/consumer backdrop and the 2026 back-to-school season. Our next webinar will be Wednesday, 9/9/26, the second Wednesday of the month, at 2:00 pm. Feedback and suggestions are welcome!
TODAY'S EARLY TRADING
The S&P Retail ETF (XRT) is up 2.3% as of ~11:00 am vs. a 0.6% gain in the S&P 500. Retail stocks are outperforming after better-than-expected results from TJX and Target.
- Stronger retail stocks include volatile DBGI, up 11%, also WRBY (up 8%), VSXY (up 6%), FOSL (up 6%) and ELF (up 5%), all higher on no significant news as far as we can tell.
- Weaker retail stocks include LZB, which is down 16% on downside results, also CATO (down 2%), CROX (down 2%), TJX (down 1% on Marmaxx slowing) and CTRN (down 2%).
MARKET-MOVING DEVELOPMENTS
All Stock Prices as of Last Close
- Consolidated comps increased 4% vs. the Street's +3.3% and included increases of +1% at Marmaxx after +6% in the first quarter, and also +7% at HomeGoods, +6% at TJX Canada, and +7% at TJX International, while total sales were $15.18B, up 6% y/y constant currency.
- Adjusted EPS increased 11% y/y to $1.22 vs. the Street's $1.19 estimate and incorporated a 50 bps increase in adjusted pre-tax margin after +170 bps in the first quarter, also 70 bps of gross margin improvement on higher merchandise margin.
- Inventories look fine and were up 3% y/y on a per-store basis, in constant currency, while availability of high-quality, branded goods "continues to be outstanding."
- Full-year guidance still includes comps up 3%-4%, while PT margin is now expected at 12.0%-12.1% vs. a prior 11.9%-12.0% and excluding a 30 bps benefit from tariff refunds, adjusted EPS at $5.15-$5.20 vs. an adjusted $4.73 last year and a prior $5.08-$5.15.
- Guidance still assumes $2.75B-$3.0B of stock repurchase for the year overall.
- TJX plans to accelerate annual store by about a ppt next year, to 4%, and now sees potential for 7,500 stores for its existing banners in current countries, up from a prior 7K.
- DoRCR INSIGHT: The slower trend at Marmaxx is a big watchpoint, though mgmt did some damage control in the press release and said 3Q27 is "off to a strong start," with sequential improvement at Marmaxx to begin the quarter, and this, along with the hike in margin and earnings guidance and stepped-up store growth beginning next year, is reassuring.
- The +0.2% comp follows +0.6% in the first quarter, while total sales grew 8% y/y to $25.96B and incorporated contribution from Foundation Building Materials, which Lowe's acquired in October 2025 for $8.8B in cash, also a 16% y/y increase in online sales.
- Adjusted EPS ex tariff refund impacts were $4.29 vs. $4.33 LY and the Street's $4.22.
- FY26: Comps flat vs. a prior flat to up 2%, total sales of $92B vs. $86.29B last year and a prior $92B-$94B, adjusted EPS of $12.25 vs. $12.29 in FY25 and a prior $12.25-$12.75.
- New guidance reflects results for 1H26 and current demand trends, includes the $0.11 per share in tariff refunds in the second quarter, does not include any potential add'l refunds.
- DoRCR INSIGHT: Like Home Depot, Lowe's executes very well and is taking share in a tough home improvement industry, but mortgage and interest rates could remain high and keep housing turnover low, while the spike in fuel costs is not good for consumer discretionary spending, especially on bigger-ticket purchases, and it's also not good for Lowe's transport costs.
- The +3.8% comp was driven by a +2.7% store comp and +8.7% Digital comp, which was led by 25%+ growth in same-day delivery, while total sales increased 5% y/y to $26.54B and reflected broad-based performance across channels and categories and thru the quarter.
- Other Callouts: Comp traffic grew 3.6%, while comp ticket increased 0.2%, Target has lowered retail prices on 10K+ items across the store over the past year.
- All six core merch categories grew sales y/y, while Fun 101 outperformed with a double-digit increase, and Food & Beverage and Beauty also outperformed, up high-single digits.
- Excluding tariff refunds, adjusted EPS grew 20% y/y to $2.46 vs. the Street's $2.34 and were driven in part by 20%+ growth in non-merchandise sales -- includes Roundel advertising revs, Target Circle 360 membership revs, also the Target+ marketplace.
- Inventories look good and were up 3% y/y, close to the comp and total sales growth.
- Full-year guidance now includes sales growth of ~5% from FY25's $104.78B vs. a prior +4% growth forecast, 50+ bps of op margin improvement ex tariff refunds from FY25's 4.6% vs. a prior ~20 bps, and adjusted EPS of $9.90-$10.90 vs. $7.57 last year.
- Adjusted FY26 EPS guidance includes $1.65 in tariff refunds in the second quarter, and excluding this, is still $0.75 higher than prior guidance at the mid-point of the new range.
- DoRCR INSIGHT: Target has been cycling easy comparisons, but there's still plenty of progress here, especially when considering the tough external (macro) environment with geopolitical turmoil, the recent spike in fuel prices, weak Consumer Confidence, etc., also inventories continue to be lean/defensive, and more profitable rev streams are growing nicely.
Analyst Actions that could move retail stocks today:
- Dollar Tree (DLTR, $130.48) Jefferies upgrades from Underperform to Hold
OTHER DEVELOPMENTS
La-Z-Boy (LZB, $40.83) had a weaker-than-expected 1Q27 (July) as strong Retail segment performance -- delivered sales up 10% y/y -- was more than offset by lower Wholesale delivered sales amid "uneven order patterns throughout the quarter," and management gave cautious 2Q27 guidance while also noting improved wholesale demand through 1Q27 and a "solid" backlog.
- Consolidated sales were $475.7M, down 3% y/y on a reported basis and down 1% when excluding the impact of the recent divestiture of LZB's wholesale casegoods business.
- Retail delivered sales grew 10% to $229M, mostly on acquired and new stores, while Retail written sales increased 16%, and Retail written same-store sales increased 3%, a 500 bps sequential improvement/acceleration from the fourth quarter.
- Wholesale sales fell 9% on a reported basis to $323M and 5% adjusting for the divestiture of the wholesale casegoods business, and Joybird's delivered sales fell 4%.
- Adjusted EPS were $0.43 vs. $0.47 last year and the Street's $0.49 estimate.
- In framing near-term guidance, management noted a "continued challenging backdrop for (the furniture) industry" and an "uneven consumer environment."
Amazon said it will expand its Prime Air drone delivery service -- orders are delivered by airborne drones in as fast as 30 minutes -- to nearly 500 US cities and towns by the end of the year, 6x the number of cities and towns currently served.
Arc'teryx (Amer Sports) is partnering with Dick's Sporting Goods to launch shop-in-shops in 15 experiential, "hand-selected premium" Dick's House of Sports stores this fall and plans to emphasize its core outerwear assortment and footwear, with "potential to expand further over time."
Aerosoles, which is owned by American Exchange Group, plans to launch men's shoes and children's shoes in the fall, along with handbags, as part of a major category expansion beyond its core women's footwear business and as part of a push to become more of a lifestyle brand.
Fabletics (digital native, activewear) has expanded its College Shop to 200+ US colleges and universities and is piloting the concept in 14 retail stores near major university campuses, including Arizona State University, Michigan State University, and UCLA.
Gordon Bros is considering selling its Poundland UK business acc' to Sky News, which notes the firm acquired Poundland from Pepco just over a year ago for a nominal price of EUR1 and says talks are underway with advisers about a possible auction of the discount retailer, which has ~600 stores. Gordon Brothers has been working to turn Poundland around, in part through simpler pricing and better value, and performance has stabilized/improved.
COMMERCIAL REAL ESTATE
Arc'teryx (Amer Sports) opened two new North America stores in the second quarter, one in Oak Ridge Park in Vancouver, and another at Southdale Center in Minnesota, now has 75 stores across North America, and sees potential for 200 stores across the continent over time.
Salomon (also Amer Sports) plans to open a new store in Beverly Hills in October as part of a plan to open 7-10 new stores in the Americas in 2026, including its first flagship store, which opened in July, on Fifth Avenue in NYC's Flatiron District and is "off to a very strong start."
Muji, a Japanese lifestyle retailer with 13 US stores, mostly in NYC, announced plans to open four more US stores in Simon shopping centers across the Northeast including: The Shops at Chestnut Hill just outside Boston this fall, The Westchester in White Plains, NY this fall, Roosevelt Field on Long Island, and Newport Centre in Jersey City, NY.
MANAGEMENT UPDATES
Albertsons has hired The Fresh Market Chief Marketing Officer since 2024 and former Dollar Tree Chief Marketing Officer (from 2022-2024) and longtime dunnhumby customer engagement exec Emily Turner as Chief Marketing Officer, started earlier this week.
MACRO/CONSUMER INSIGHT
Out yesterday 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 yesterday, 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%.
And also out yesterday, Housing Starts for July were much weaker than expected and fell 12% m/m vs. the Street's (6.6%) estimate after a revised +20% increase in June and were down 14% from July 2025, while Building Permits increased 5% from June and were 3% higher than 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%.
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