Yule Sales Fall Below Projections High Debt, Shortened Season Blamed For Disappointment

There was more Grinch than glory at some of the nation’s largest stores this Christmas.

Shoppers watched their wallets at J.C. Penney and Dayton Hudson Corp., which reported disappointing holiday sales, and at CompUSA, where second-quarter sales rose only 1.5 percent from a year ago.

“After Thanksgiving, everyone was jumping through hoops about this Christmas,” said Robert F. Buchanan, a retail analyst at NatWest Securities. “But that was a lot of baloney and we saw a slowing of consumer spending.”

The companies’ stocks fell Thursday on the New York Stock Exchange. J.C. Penney was down 87-1/2 cents to close at $47.87-1/2, Dayton Hudson fell $1 to end at $38.25 and CompUSA was down $4.50 at $16.25.

Store owners had been upbeat about this Christmas after suffering through a dismal season a year ago. Many thought a rebounding economy and high levels of consumer confidence would ignite lots of buying this year.

Despite reports of brisk buying the first weeks of the season, many retailers failed to keep up that pace through Christmas. Steep levels of credit-card debt, foul weather and five fewer shopping days between Thanksgiving and Christmas contributed to the slowdown.

While most retailers won’t report their December sales until Jan. 9, Thursday’s reports suggested the season will fall short of expectations with only slight sales gains from a year ago.

“It wasn’t a great Christmas,” said Joseph Ronning, a retail analyst at Brown Brothers Harriman. “You have different kinds of retailers reporting disappointing numbers and that makes it hard to categorize where the strength was or could be.”

J.C. Penney, which had strong sales for much of this fall, said comparable-store sales for the four weeks ended Dec. 28 rose just 6.2 percent from a year ago, and sales for the combined November and December climbed just 4.5 percent.

Comparable stores sales at Dayton Hudson increased 4.2 percent from a year ago, with its Target discount chain increasing 7.1 percent, Mervyn’s stores gaining 4.1 percent and department stores rising just 0.3 percent.

At computer retailer CompUSA, comparable store sales were up 1.5 percent in its fiscal second quarter for the 95 stores open one year or more.