Navigating a Negative Rate World
October 28, 2019
41086_Transcript for Nov Ivy Live
Good afternoon. Welcome to Ivy Live. The US consumer is alive and well and has been a significant contributor to growth in 2018 accounting for about 70 percent of U.S. GDP is hard to grow in the consumer is feeling Frugal a number of things have led to increased consumer spending including tax cuts Rising wages and falling unemployment. The latest data show real disposable income and consumption up about three percent year-over-year consumers feel confident and Survey data shows it. Well the University of Michigan consumer sentiment index is near a physical high and let's not forget a confident consumer typically signals robust spending will see if our panelists think this continues into 2019. We have the consumer covered with this group joining us today.
Portfolio manager Nathan Brown and analysts Brad Angermeier and Victor Lee. So let's get to the topic at hand. How you doing? Nathan? I'm well good consumer spending has done really well in 2018. You know, like I said on the introduction there have been a number of factors that have contributed that go through what we've seen in 2018 and what we think we're going to see in 2019.
Nathan: Sure. So in 2018, just a fantastic set up for the broad consumer. You touched on a couple of them unemployment is what are we at? 40 years of 30 40 year lows at this point three point seven percent, you know when people have jobs they feel comfortable that they can spend we talk with a tremendous amount of companies both in retail and in other areas and without a doubt people are looking to hire and then finding those people to hire is one of the big constraints to some of the growth. So that is a really good environment for the underlying consumer. So unemployment slow. We're starting to see wages pick up now. That was that's kind of been the missing thing so far in this recovery is you know, we should have seen it already given past recoveries, but we're now at the point where wages are starting to pick up. So not only are you employed you're also starting to actually make more money for the hours you're working and the confidence is super high. Finally as you mentioned the tax cuts. That is that's been a really nice additive to you know their wallet right because you're actually get to take home more than more than you were in the past. Some of that comes out of, you know, your everyday paycheck and then some but we think can also you'll see some of that in 2019 as tax returns get filed and it should also be a nice little boost into Q1 of 19.
So very good set up into in 18 and given where we currently sit know the economy still good the u.s. Is still in good footing there's lots of questions out there and from a Global Perspective but it feels really good for the u.s. Today. Maybe one area which is a little outside of retail which I'm sure will spend most of the time talking about is on housing has seen some weakening. We think that for the most part that's a, you know, a little bit of a digestion period from what higher rates and higher home prices mean there's a period of time which you have to adjust a I thought I was going to be able to pay this for a monthly payment. Well, it's going to be more than that. So there's a chance you see maybe a little bit of weakening in the house prices and we're already starting to see that but we think that that can you know help that should accelerate in 2019 once we get through this digestion period so just a really
Really good environment for both the income statement for consumers and quite honestly the balance sheet for consumers which should mean continued real strong growth.
Jeff: So speaking of Housing and there's a lot of consumption and investment that goes along with buying a new house. So if we get a little bit of relief there with that you consider that to be a tail wind or a headwind as we go into the New Year.
Nathan: so I would think that that would be an additional Tailwind. We saw that we've seen the broad housing metrics weekend, but as it relates to retail, we really haven't those areas still remain fairly strong. There's a normal lag that takes place, you know, if you the great example is Like Home Improvement the Home Depot and Lowe's right people will paint their house before they put it on the market a beige and in the new people come in and they paint their house what you know a yellow and so you get 2 different to painting transactions for one house turnover, so you
And there's a lag that goes along with that. So usually it's six to nine months. So I think we'll still see a little bit of the pressure of what's happened during 18 into early nineteen in some of those areas. But then once we get past that we feel like, you know, it can be a contributor to growth again.
Jeff: Okay, and let's talk a little bit about retail before I get on to our other panelists. We talked to her about it comps going into the fourth quarter or going to be increasingly hard to beat and additionally you can also think of the tax cuts is there's kind of a comp there to maybe the second quarter of next year. So, how do you how do you evaluate the environment with those in place?
Nathan: Yeah. So without a doubt in Q4 of 2017. We really saw the consumer come to the market and begin to really spend some of this improved economic situation that they've been that they had been feeling and you know part of that was you know, what we had a fantastic weather period during that period of time we've actually it's been cold already this season. So that bodes well for Q4 as well, but with good, you know with good decent weather you saw that Improvement in 2017. So yet now we're going to face we're going up against what are quote unquote more difficult comparisons, which they are but in the past the consumer wasn't spending like their income statement would have suggested that they could spend and so there's still plenty of room for them to flex and continue to continue to spend going forward and we would expect that to happen 2019. Maybe not at the same rate that we saw and growth right consumer in in the mid cap index. The consumer stocks are up some the specialty and Broadline retailers are up 15 to 20 percent so far this year, which is obviously been a really good place to be. We're not sure that you're going to have quite that level about performance because some of those secular things that people were really worried about these companies have been able to adjust to the new world if you will the omni-channel world. So, you know, I think that there's greater investor confidence in some of these business models. So once you kind of get that inflection, I don't know if you'll get that same but we still see nice earnings growth for most of these companies going forward. All right
Jeff: And, Brad you know, I think a lot of your companies have reported Victor's not so much kind of the last report. But what have you been hearing from your company's reported so far and I want to you know, think about specifically and Nathan mentioned a little bit and kind of the wealth effect and how consumers are feeling right now and we've had a market downturn and you know, I would expect that to hit confidence a little bit in November numbers that are they seeing any consequences from Global markets turning down over the past couple of months.
Brad: I would say generally no the companies. I follow tend to be Global in nature so that Large Global branded apparel companies luxury goods companies that sell not only in the US but in Europe Asia, and so I would say the message in this earnings season has been consistent with Nathan's comments the US remains a source of strength. The European consumer has been a little bit sluggish I would say and I guess the Third Leg of the stool is Asia and when we talk about Asia were mostly talking about China. It's the Chinese Millennial that's really the driver of consumption growth in that region and that has that consumer has been incredibly strong for the last couple of years, but it's starting to wobble a little bit. So the big I think the thing that that investors and companies are hyper focused on right now is what is the second derivative Trend and among the Chinese consumer? And that's probably if I were going to highlight a source of uncertainty. That's probably it but Us remains like I said quite solid for all the companies, I follow and broadly no one none of the companies. I follow her lowing outlooks. They're not, you know, they're their commentaries not turning more negative necessarily what they are the way they are characterizing the Chinese consumers so far is essentially a normalization. So the law of large numbers catches up, you know, you can't grow 20% forever. And so that is what most companies are talking about right. Now. The question is does that does that normalization become an outright slow down and they're a mixed signal so far, but for now the Chinese consumer remains quite strong.
Jeff: Okay and luxury goods used to be I mean when you would think of Chinese consumers you would think of especially European luxury goods how sales there are these days.
Brad: for luxury in general. Luxury has been going through a two or three year period of extreme extremely strong growth and that goes back to the to the Chinese consumer that I just talked about going through the say the 2000 really that 2013 through 2015. There was there were a lot of had ones for the sector most notably the Chinese government that they instituted what at what we refer to as an anti-corruption campaign. And so there was you know, a lot of gifting and bribery and things happening that they wanted to weed out and I think the unintended consequence of that is not only were things such as you know five and ten thousand dollar watches that were being given as bribes that consumption went away. But the everyday consumer also was hesitant to spend on extravagant items such as luxury goods. It kind of became taboo for a while so discouraging
Specially configured exactly conspicuous consumption was out of style in China for a few years as a result of that and as that hangover faded you really saw the Chinese consumer come back in force for the luxury industry and it has been unbelievably strong for the last two or three years.
Nathan: What's interesting too. I mean, so the savviness of the Chinese consumer on where they buy they know their prices, you know of a Louis Vuitton handbag what it is in Paris what it is in China what it is in Hong Kong what it is in the US and based upon currency movements and everything else that they will change where it is. They buy they are an incredibly Savvy consumption.
Jeff: A lot of luxury goods sold in Europe or actually from Chinese tourist is there I said,
Brad: Yeah exactly and that's another thing that contributed to the rebound that luxury has seen in the last couple of years is currency had been helpful. Not so much right now, but feel last year so currency has definitely been hopeful a strong Chinese currency helps that traveling consumer. You also saw though during that that end of that period I talked about where the anti-corruption campaign was still impacting consumption. You had a number of terrorist events in certain European cities that kind of put a halt on Chinese tourism to those cities. So you kind of had a little bit of a double whammy in terms of Chinese luxury consumption slowing down and you know, memories are kind of short as that thing goes and so as we've gotten farther from those events the consumer or the tourist I should say has come back so that has contributed to the rebound as well.
Jeff: So from here what you're hearing from, your global companies u.s. Is relatively stronger, but the consumers not done in Europe or China, which is where the growth slowdown fears are
Brad: so far the Like I said the US remains a source of strength China continues to grow very well, but at a slower Pace than it has been so the question is how much does that slow down? Right? You know, where does the slowdown stop? We're seeing kind of mixed signals and it kind of makes sense, you know things that are lower ticket items apparel at least in in the companies that I cover apparel Footwear even handbags which are can sometimes be quite expensive those items have held up better much bigger ticket items like luxury watches have been a little bit weaker and it seen a sharper deceleration. So that's why I said we're starting to see some mixed data points from the Chinese consumer, but broadly we're still talking about strong growth just at a slower Pace.
Jeff: Okay, Victor, let's turn to the US a little bit because I think that's where most of your coverage Falls your retailers, you know, two years ago. We thought u.s. Retailing was dead. We thought you bought everything online but it seems to turn the corner a little bit over the past 12 to 18 months or so. Let's talk about online retailers versus you know, the ones we see down the street from our house is and what's going on there, right?
Victor: So the narrative in 2017 was the retail apocalypse, you know all the brick and mortar guys are going to be decimated by Amazon. I think that was sort of the narrative that turns out to be overblown overdone narrative. It turns out that retailers through the ones that do adapt and are able to invest into their business in Embrace omni-channel are able to survive and actually thrive in an environment where retailers like Toys R Us and Sears are going bankrupt. So what we saw in like Nathan mentioned in Q4 2017 is that we saw a very good holiday season and Q4 tends to be the quarter that you See dis-proportion of sales coming through online because people the convenience of buying online. It's more pronounced in Q4, especially, you know, like forcing Black Friday. You don't want to go through all the chaos in a store rather. You would just make a few clicks and make get the deals
Jeff: Lazy people like me. It's much easier to actually so
Nathan: you can still wear your black Friday shirt with your sisters and your girlfriend. I'll just do it at home exactly.
Victor: So and before then I think retailers were a bit complacent in terms of embracing online channels and omni-channel in general. I think one of the wake-up calls in 2017 was when Amazon acquired Wholefoods and all the not only just to grocery stores, but also the general merchandise retailers like Walmart and Costco. They were all hammered and I think the fear was that Amazon is going big in terms of omni-channel. So what we're seeing in a you know, long-term perspective is the pure-play online guys are actually buying up brick and mortar or stores assets and the brick-and-mortar guys are coming in and actually investing more into their e-comm capability. So everybody meets in the middle. So the narrative I think it's not really, you know, whether it's online or offline. It's more about it's just new retail. This is just going to be there's no like distinction between what's online offline. It's going to be you're going to buy stuff through your phone or at the store and you're still going to be using your phone to find the items you want or get the recommendations you need and check out the customer reviews in the store as well. So those kind of you know, how the experience involves if you think about it at the end of the day the retailers were able to invest in those kind of capabilities and experience are the ones I think will continue to gain market share and what you're saying is we chose like Walmart who just posted a 4.6 percent COMP in Q2. That was the best COMP posted as decade and obviously the stock reacted very well for that. So you're seeing those kind of big retailers actually gaining share at the expense of the ones that are marginalized like Sears obviously is a good example, but there's a lot of specialty retailers Bed Bath and Beyond is good example as well that are being marginalized who are not able to adapt to the new normal and the stocks that we focus on are the higher quality ones the secular winners. Like I said Walmart is a good example Target is also upping their game, you know, obviously Costco is has been any secular winner for very long time. So overall, I think the favorable consider backdrop is the Tailwind structurally speaking. We're seeing a much stronger from a competitive position you stamp were much stronger set of brick and mortar players that are able to withstand the pressure from Amazon in terms of embracing online and also embracing the evolving testimonies that the use customer wants. So overall, I feel pretty good about those winners not so much about the whole space, but I do think there are pockets of opportunities out there that will continue to see some outperforms.
Nathan: Victor mentioned 2 retailers, which I think it's an important thing to point out is for the most part retailers don't have large shares of any one given Market. They it's a incredibly fragmented industry Walmart's one of the few exceptions to that. They have a large share of the overall retail Market, but the only 10% exactly it's a right that is your high water mark and so when you have companies like for Year's Toys R Us has been seating share four years Sears has been seeding share but Sears still has 15 percent market share of the lawnmower Market. Well, that's all now going to go to Home Depot Lowe's this year Sears close stores Toys R Us made up nine to twelve percent of the toy companies sales. So now those sales are now going to be distributed from to the other retailers. So while it's been a good backdrop for most retailers is Victor mentioned, there are some that have gone out of business and that has provided share opportunities and it's not the, you know, Chip Away market share opportunities. These are Big shares that mean if you talk with any Mass retailer, they're all expecting to take share and toys this year because Toys R Us is no longer exist in existence.
Jeff: That's a good point. That's a good point. What speaking Toys R Us or Sears who's going to be the biggest beneficiary that?
Victor: So for toys the big the top four players and toys it was Toys R Us Target Walmart Amazon. So obviously Amazon Target and Walmart will be the beneficiaries from a sales, you know portion standpoint. Target will probably see the most upside in terms of numbers Walmart is too big to really benefit from that likewise for Amazon for Sears. I think Home Depot and Lowe's will be the beneficiaries in terms of Appliance businesses that they'll take share from so Sears, although you know, you would be surprised how big their appliance business was. It was still significant even up until this point. Lowe's was number one in appliances. Sears what I think or number two or three and then Home Depot's number two and three as well.
Jeff: Okay. I'm going to put all three of you on the spot here and it's because Amazon was mentioned. I don't know how we don't mention Amazon in this conversation, but you were saying and I've been hearing this for a while that the brick and mortar retailers have found ways to adjust to competing with online Amazon now that that's happened and you know Amazon click the stock here lately. This may be have we seen Amazon kind of peak as far as market share as far as kind of growth here in the US.
Victor: I can speak about Amazon I cover the stock so the incremental sales, so if you look at US retail, roughly 40% of the incremental sales come from e-comm and within e-comm, roughly 40% of that comes from Amazon. So but that used to be north of 50% So the dominance of Amazon has moderated I wouldn't say it's, you know deteriorated. I think it's still had a very elevated level but still I mean if you look at 2016 and 17 it really felt like Amazon is going to kill everybody. So where were we I think we move past that point and we're seeing a more moderated dominance from Amazon, but from Amazon's own quarterly earnings perspective. I think the strength we saw in North America really suggest that the weakness is not really North America. They saw some weakness internationally, which is UK, Japan and Germany the primary markets and also India, so I wouldn't interpret the stock reaction of what Amazon stock is doing saying that oh actually brick-and-mortar guys are winning against Amazon. It's really they're still posting mid-20s percentage growth in North America and 90% of North America the u.s. So I don't really see any slow down on that end yet, but it has to decelerate. I mean, they're law of large numbers were that's that numbers will come down.
Nathan: It's hard to say that you know, I think it’s right to think e-commerce going to continue to gain share for here. As long as the eye can see but it's hard to make the claim that Amazon is going to put Walmart out of business when Walmart puts up the best COMP its put up in a decade. So I think and that's has a multiple impact on both the retailers because now they're figuring out how to compete with them. But then also on the e-commerce only guys because this goes well, wait a second. Maybe they don't just take a hundred percent of Walmart share maybe Walmart can adjust and some of the other retailers that have been able to put up good numbers can figure out how to One participate in e-commerce to figure out the margins and Walmart. Did that very very, well. Absolutely. Absolutely. No Walmart hasn't they've struggled to grow earnings because they're but they're playing the long game which is the right thing to do.
Victor: If you think about it, like Nathan mentioned the US retail space is extremely fragmented. So Walmart is only 10% of us retail Amazon is five to maybe six percent this year. So even if you think Amazon is a behemoth in the you know Market, they're still relatively small compared to the whole Market space. The US retail is north of three point five trillion terms of sales. So I think there's plenty of room for everybody to grow at the expense of smaller players.
Nathan: What's interesting for Brad's companies and then, you know, let him take it so we had a company and they said the Amazon is just another distribution channel for a lot of the brands, but they did say that the E-commerce Channel, they hold half the inventory that they do it brick-and-mortar. So you do have to go through this adjustment period of okay as online take share. It means that there's requirement for less inventory in the channel. So you will have a one year sales adjustment aren't actually will continue to on through multiple years, but if you just think as e-commerce gain share that inventory sits in a warehouse, which is way more efficient inventory than a you know, a garment that sits in every retailer, you know it at every single Macy's on that on all the racks they can just house it at one distribution center and send it to whoever wants to buy it.
Brad: So that I mean the implication of that is for companies that I follow brands that are wholesale oriented in terms of their distribution meaning they sell in two big retailers like Walmart Amazon Macy's whoever it may be they it's just kind of maybe not even visible in a given year, but it's just a really slight headwind to their wholesale Revenue growth as that that that transition plays out from from brick and mortar to e-comm.
Jeff: Okay, Victor we didn't get to so looking your company's. I think he spoke a little bit about it. But what are you seeing? What are you seeing about the US consumer based on things you're hearing about the company's you follow which are mostly domestically focused?
Victor: So retailers are just now starting to report Home Depot reported yesterday Macy's reported. Today. We're going to have Wal-Mart for tomorrow's Walmart will be a good, you know way to get some read through this because they're so big but like today Macy's posted 8.3% comp and they were pretty optimistic about the holiday season going into the holiday season, and I think it just reinforces the fact that us consumers are in a pretty good place. And one of the interesting anecdotes from Home Depot yesterday was that more than 50 percent of the tax savings or tax dollars will be actually distributed early next year when we get the tax refunds because most people didn't really adjust their tax withholdings yet or this year. So that'll be a pleasant surprise to many people and I think given the fact that the marginal propensity spent is almost close to a hundred percent for middle class and below a lot of that money will be spent and so that that will be a nice boost.
Jeff: We do as a country like the spend most of what we earned on although we don't I mean that's its
Nathan: that's one of the big changes since the financial crisis is that's why consumer spending has kind of been sluggish than what people more sluggish than what people have thought. It should have been this, you know this cycle because we're not acting like Americans acted in previous Cycles. There's savings rates way higher than you would have expected. Yes. It is and yours into after recovery.
Jeff: Yeah, but that just means we've got deeper Pockets right then going forward. Definitely. There's the balance sheet to support spending. Oh, yeah, exactly. So we've got one question here and it's not the good thing about being a live broadcast as we can get questions on anything. It doesn't necessarily pertain to retail but maybe something that we said earlier and talking about the CPI report this morning and how wages are doing you want to try to tackle that or maybe I can.
Nathan: So there's a lot of inflation out there in the economy. It's generally not making its way through most of the reports, right? I mean CPI what it came in .3 today, you know, right we're running just over 2% I think overall. I mean that's based upon a lot of the companies we listen to not really the on the retail side. But in other areas, I was just at an industrial conference last week every single Industrial company is pushing through pricing Freight rates are and that's clipped actually a couple of retailers this year Freight rates started getting really hot in the summer of last year with the hurricane Harvey and had extended all the way through this year. So they're up 25-30 percent from where they were two years ago. You've got the Tariff issues. So a bunch of companies are trying to push through pricing in ahead of and in response to what tariffs can be. So I think it's we'll see if it flows through the government numbers, but without a doubt we've definitely heard of a, you know, a decent pick up in a lot of different industries from inflation,
Jeff: And I think the question also is referring to maybe there's some confusion around 2 percent but you know average hourly earnings grew like 3.1 percent the last night, but we've also got to talk about productivity and things like that. So wages are growing faster than inflation, but productive activities picked up a little bit unit labor costs are down. So, yep, but we definitely think it's in the pipeline. If you look at leading indicators it inflation should be running hotter than it is now.
Nathan: It should be now. There are very very large deflationary forces out there in the economy eCommerce, right price transparency is absolutely a deflationary pressure, cloud computing right there all share, you know, bunch of companies are sharing the same server, which means it's one server versus everyone having their own server and on their campus. So there are some very very large deflationary forces out there in the economy, but from a cyclical perspective, it definitely feels like things are picking up .
Jeff: in our Economist. Just put out a note. I haven't read it yet but you know, especially in the short term, you know, headline CPI probably comes in flat with gasoline prices falling as well as they are. So we're not going to have a lot of pressure there here in the near term. So closing thoughts guys, you know it as you're looking out into 2019 and you're thinking about recommendations and you're thinking macro and consumer what the consumer is going to do. Are you pulling back on what you think buying power is going to be at all and focusing more on maybe more not Staples, but more staple type names versus maybe more than a luxury good or are you still thinking, you know, we've got power here not concerned about that at all?
Nathan: Yeah. So, you know, we're being we've been overweight consumer discretionary in our funds and mid-cap funds. We've been pulling that back a little bit not because we're concerned about the underlying consumer that it's just more these have performed incredibly well, and so you should expect us to continue to work that down. We are significantly overweight that space But it's more of a let's take some profits and some of the winners we've had versus we're really worried about these companies going forward. We think the Outlook is still very constructive for the space you guys agree.
Brad: Yeah, and for me as I kind of mentioned earlier, the US consumer is really not a concern that the primary concern I would highlight for the companies. I follow is the Chinese consumers I talked about and you know, there's really in the in the world that I cover. There's really no hiding from China risk. You either have risk from tariffs escalating which have largely avoided the categories that I that the companies I follow sell into so that that risk is looming or you have you have a multinational company with global brands that are very dependent on the Chinese consumer. So there's China risk in some sort really for almost everything. I follow so, you know trying to hide from that is really kind of a I think a tough thing to do. So from my perspective, I'm focused on the same things that I have been all year Quality Companies, that means good brands and good categories with good management teams secular Tailwinds behind them to the extent those exist in these categories and you know, really betting on idiosyncratic, you know, idiosyncratic stories rather than you know, trying to make macro calls
Brad: Victor. What's a high-end Company Fall? Sorry the high-end company that you follow name one hiring Goods more expensive Goods.
Victor: A lot of the names I prefer are actually Discounters the discount. I was going to ask you do you prefer Nordstrom versus at Walmart? What Walmart? Yeah. So like just Brad mentioned I try to focus on idiosyncratic stories that I think have more sustaining power or staying power versus just riding the tide. I think the tide is probably not going to be as awesome as it wasn't 20 18 verses 2019. I think that will moderate so the names that I follow typically I can pretty much categorize them as cyclical versus defensive and the defensive ones tend to have more.
Last fall till tender top-line numbers like you know off while our Target Target Target made my name so but Walmart is also very is from idiosyncratic story. Like I said off probably serves Auto Parts Home Improvement is more about the housing cycle issue. But if you just look out if you just you know, assume housing is neutral. They also pricing power. So tariffs is also a risk and if that that actually kicks in Auto Parts and Home Improvement, actually the better categories to be in terms of pricing power. They can just pass it on historically. They've been pretty successful at that versus the other categories. I think a less much so terms of pricing power. Okay. So all I know I prefer the ones that have a just idiosyncratic story that will help alleviate, you know, any potential downside risk in terms of the macro actually slowing down.
Jeff: Okay. Okay, we've got one. Final question for you, Brad, and then we'll go if you look at luxury goods guys and say they're kind of a leading indicator of how the economy is going to go forward. Do you have one that's more domestically focused that gives you a much better read through on the US and how are they performing?
Brad: Well, not the luxury players that are more domestic focused. I would not really consider them true luxury there. Maybe what some people would call accessible luxury or affordable luxury Tiffany. Okay, Tiffany's that's fair Tiffany. The read whether their domestic company or not, really the read for the from the US consumer in the luxury space is still positive. Okay to the extent that those types of companies are flagging weakness in the u.s. It's more about the effect of the dollar being strong recently and international tourism into the u.s. Slowing or potentially going negative. So whether you're talking about European Luxury company that has a small business here or Tiffany that has a larger business here the commentary on the domestic us consumer is solid. Jeff: All right. All right good. Thank you Brad Victor Nathan. Be sure to register for December's IV live as we discussed the health of the global economy. Heading into 2019 will also let you know our thoughts and how we expect asset prices to react is recent Market action giving us Clues? Thanks for joining and we'll leave you with our promo for December.
Several technical terms and acronyms were used throughout the recording. The University of Michigan Consumer Sentiment Index is calculated monthly and measures the degree of optimism that consumers feel about the overall state of the economy and their personal financial situation. Omnichannel is a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether the customer is shopping online from a desktop or mobile device, by telephone or in a brick and mortar store. COMP is short for comparables. It refers to a retail company’s same-store sales compared to the previous year and is used by analysts to make comparisons from year to year.
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