Most retailers posted solid sales gains in May, with chains such as Target, TJX, and Limited topping analysts' estimates for the month.
"Retailers rebounded from a soft April turning in solid May same-store sales results this morning fueled by decent weather conditions, robust Mother's Day selling and enticing Memorial Day weekend promotions," said Ken Perkins of Retail Metrics, in a research report.
The Thomson Reuters Same-Store Index, which tracks the stores that release monthly sales reports, rose a robust 3.9 percent in May, topping its final estimate of 3.6 percent. While that figure could change when drugstores report their monthly sales, it is solid gain although not as strong as last year's 5.4 percent gain.
It appears Macy's, which reported better-than-expected same-store sales results on Wednesday, set the tone for the bulk of Thursday's reports.
Target , TJX , Limited and Zumiez all topped estimates.
TJX's strong performance in May even prompted the company to raise its forecast to the high end of its previous earnings estimate.
Stage Stores smashed its final estimate and posted its highest increase for May in 10 years. The retailer said it benefited from the shift of Mother's Day promotions from April last year to May this year.
But the news was not universally good. Costco Wholesale said its same-store sales rose 4.0 percent, just shy of the 4.3 percent analyst estimate. Costco was hurt by deflation in gasoline prices and foreign currencies.
Gap, which has been working to turn around its business, also came up short. Gap's sales rose 2 percent, as sales unexpectedly declined at its Old Navy stores. Analysts were expecting Gap's sales would rise 3.1 percent.
Kohl's also continued to struggle. The mid-tier department store said its same-store sales fell 4.2%, far more than the 1.2 percent decline analysts were estimating.
Kohl's has been criticized for failing to capitalize on rival JCPenney's troubles. The company also has stumbled in its attempt to manage inventory more tightly and avoid deep discounting. As a result, Kohl's saw a shortage of products during the month, which hurt sales. Unfortunately, the situation won't correct itself quickly, and Kohl's shares sold off in trading Thursday.
"We made some progress in building our inventory levels, but continue to expect lower units to hinder our sales until the back-to-school season," Kevin Mansell, Kohl's chairman, president and CEO said.
Teen apparel retailer Buckle also posted a big miss, with a same-store sales gain of 0.2 percent, compared with the analyst estimate of 3.3 percent, reported by Thomson Reuters. Meanwhile, same-store sales fell 8.8 percent at Wet Seal , a wider decline than the 8.3 percent drop analysts were expecting.
Retailers will be challenged in June to maintain the momentum.
"Retailers face their most difficult comparison of the year in June at 7.2 percent so we are quite likely to see a sequential slowdown from May sales," Retail Metric's Perkins said.
Perkins added that news Thursday on layoffs from Challenger, Gray & Christmas as well as ADP and jobless claims reports , which suggest a weakening of the labor market. If Friday's non-farm payroll report reinforces this view, there is the potential that consumers may grow more cautious in their spending heading into the summer, he said.
The retailers that still report their monthly sales represent only a portion of the nation's retailers.
A table of the results follows: