Goldman Sachs’ Broadline Retail Update (WMT, FDO, JNY, SKS)

Goldman Sachs is out with a research report this morning, where it takes a look at the recent performance of the broadline retailers in Q2. They noted several key points, including: 1. Broadlines Q2 EPS ushered in expense driven beats and lowered guidance, compared to Q1’s margin drive beats and upward guidance revisions.2. Rain or Shine Index indicates that August was 26% drier and 2% warmer than last year.3. Wal-Mart’s (NYSE: WMT) pricing gap showing some stabilization, settling in at 299 bp, after last month’s regional phenomenon.4. Promotional e-mail growth picked up at department stores, +21% as inventories began to build post Q2.5. In Retail Forward’s spending survey, respondents grew less bearish as only 32% plan to spend less, while 60% plan to hold spend constant.6. Broadlines’ stock short interest is up 1% compared to five-year averages but up 14% month over month with Family Dollar Stores (NYSE: FDO), Jones Apparel Group (NYSE: JNY), and Saks Inc. (NYSE: SKS) sitting well above five-year averages.