The holidays are behind us, but now is the time when investors find out just how retailers did during the key selling season. Over the next several weeks, a number of leading chains will post their holiday 2015 sales and trends.
Tiffany (TIF) is set to reveal how it did on Tuesday. After a disappointing holiday season last year, the high-end jeweler is likely to sparkle for investors, according to Brian Nagel, who covers the stock for Oppenheimer. “I think Tiffany will look decent this holiday,” said Nagel.
He also notes that the weather, which is often blamed by retailers for lackluster holiday results, is not a factor for Tiffany. As for the items inside the little blue boxes, “holiday shifts more the fashion product, generally speaking,” said Nagel.
On the other end of the shopping spectrum, J.C. Penney (JCP), which offers a more affordable product line, showed a strong holiday season. The department store chain reported a 3.9% increase in same-store sales during the key holiday quarter. Nagel was expecting a tougher quarter for J.C. Penney, citing the warmer weather. “The Northeast was warmer than usual. That very much impacts sales of cold-weather type products. I would suspect that J.C. Penney will feel that impact,” he said.
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Beyond the holiday shopping season, Nagel thinks the real key to J.C. Penney is its new leadership. “I think 2016 is going to all be about what does Marvin [Ellison] bring to J.C. Penney,” he said. Ellison, who joined as the retailer’s CEO, has previously worked at Home Depot (HD) and is well respected by Wall Street.
But if the senior retail analyst had to recommend just one retail stock for investors, “I think at this point, Tiffany is your much-better play,” he said.
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