Strong April for Retailers

Several clothing retailers, including Limited Brands Inc (NYSE:LTD) and Zumiez Inc (NASDAQ:ZUMZ), posted better-than-expected sales in April, helping to allay fears that March's strength came from an earlier Easter and a warm start to the spring season.

But Costco Wholesale Corp (NASDAQ:COST) missed Wall Street estimates for the second month in a row, indicating competition with other big-box retailers hurt the biggest U.S. warehouse club operator's performance.

Of the eight retailers that had reported April sales by early Thursday, four beat expectations and two missed, according to Thomson Reuters Data.

The Thomson Reuters index of analysts' expectations for 20 retailers that report monthly sales at stores open at least a year called for a 1.5 percent increase in April, compared with a 4.3 percent rise in March.

March results benefited because of an earlier Easter -- April 8 this year, compared with April 24 in 2011. It was also the warmest March in more than 50 years, which helped spur sales of spring clothing.

But that momentum continued into April.

Victoria's Secret parent Limited Brands Inc <LTD.N> posted a 6 percent rise in same-store sales, beating estimates. ID:ASA043YY]

Teen clothing retailer Zumiez Inc <ZUMZ.O> also beat estimates with a 10.1 percent rise.

And on Wednesday, American Eagle Outfitters Inc <AEO.N> sharply raised its profit estimate for the latest quarter as it sold more spring clothes at full price.

Costco was a different story. Its same-store sales rose 4 percent, while analysts were expecting a 5.1 percent increase, according to Thomson Reuters Data.

"It didn't seem to receive the traffic lift one would expect operating gas stations that sell cheaper petrol and stores that undercut grocery chains," Brian Sozzi, chief equities analyst of NBG Productions, said in a note.

Sozzi said Costco, which competes with Wal-Mart Stores Inc's (NYSE:WMT) Sam's Club and BJ's Wholesale, has been "a bit more aggressive in terms of price to drive traffic." Its March results indicated consumers could be finding a better experience and prices elsewhere, he added.