A shopper holds a Banana Republic bag in San Francisco, Calif.
Photograph by Justin Sullivan — Getty Images
By Michal Addady
November 1, 2015

Morgan Stanley analysts say retailers could see coal in their holiday cash registers this year.

Analysts at the Wall Street firm led by Kimberly Greenberger say that while consumers may have more money in the wallets this year due to the better economy and lower gas prices, there is a good chance that consumers will spend less of those extra dollars than last year.

The bottom line: Greenberger predicts a 1.2% growth in holiday sales in 2015, less than half of last year’s 2.8% increase.

The analysts postulate in a note titled, “The grinch will steal Christmas,” that this is because consumers now spend less money on apparel in general. What’s more, 2015 is predicted to have an unusually warm winter. That will put a damper on seasonal purchases. So when retailers complain about the weather this year, they may actually have a point.

While many retailers will struggle, Greenberg and her team predict some retailers may fair better than others.

Greenberg says L Brands (LB), parent company of Victoria’s Secret and Bath and Body Works, comes into the holiday season with momentum building in both of its brands. Lululemon Athletica (LULU) sales are expected to go up after the retailer introduced its pant wall in September, a new store design that allows for a more personalized shopping experience.

The analysts have also projected high sales for Ross Stores (ROST), Nike (NKE), and Best Buy (BBY).

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