Posts Tagged ‘ target ’

Wall Street vs. Main Street Investment Attributes

February 29, 2016
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Wall Street vs. Main Street Investment Attributes

Market leadership is constantly changing as sub-sectors come in and out of favor and particular investment attributes ebb and flow in popularity. One new theme in 2016 is the resurgence of “Main Street” type investments and overall investment exposures relative to “Wall Street” investment exposures. More simply put, mass market exposures are outperforming higher-end, upper income/luxury exposures. Within the consumer space noteworthy moves and investment shifts are underway as some of 2015’s high fliers are dramatically tumbling back down to earth. A stark example is Restoration Hardware. The stock is cut in half since the start of the year and down some 60 points, to $40, from prices above $100 just last fall. The culprit for RH is a dramatic sales and earnings miss in a promotional environment for furniture....

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Sears Holdings (SHLD) – Flawed Strategic Experiment Results in Retailing Train Wreck – AutoZone and Sears Comparison

December 28, 2011
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Sears Holdings (SHLD) – Flawed Strategic Experiment Results in Retailing Train Wreck – AutoZone and Sears Comparison

Sears Holdings pre-reported Q4 results which showed a rapid deterioration yesterday. The most alarming item in the press release was the rapid deterioration in sales trends at both Sears and Kmart. Sears comparable store sales trends ran -3.3% in the YTD period (which is a month away from the full year) while the trends through the first two months of the 4th quarter came in at -6.0%. Kmart sales slowed from -1.8% to -4.4% in the YTD to QTD period. Retailing is tough and you can’t run a retailer without regard for the shopping experience. Eddie Lampert attempted to replicate the magic formula he applied to AutoZone (AZO) with Sears Holdings. The experiment has failed in spectacular fashion. In order to understand what went wrong with Sears it is...

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US Economy Demonstrates Resiliency – Retailer Comp Sales Strengthen in September

October 6, 2011
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US Economy Demonstrates Resiliency – Retailer Comp Sales Strengthen in September

Despite massive uncertainty stemming from the manner in which Europe is handling its financial crisis, a gut wrenching stock market sell-off (the S&P 500 was down 7.2% last month), negative headlines almost every day, and predictions towards the end of the month that the US economy is now “in a recession”, the US consumer continues to spend at a healthy rate. Perhaps the savings rate is now high enough at 5% which is leading to more stability in retail sales than many predict. Stability with the growth rate of retail sales is one of the most important inputs towards GDP growth. With personal consumption expenditures as a % of GDP still above 70%, a 4% growth rate in PCE makes it all but impossible to be in a recession....

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Target – Missoni is a Home Run!

September 16, 2011
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Target – Missoni is a Home Run!

A number of news reports have been out regarding the new exclusive apparel and home line designed by Missoni for Target (TGT). The Italian designer is very well regarded in the fashion world and Target getting an exclusive launch of this magnitude speaks to the credibility of the merchandising team and the power of the Target brand. Target experienced a website crash while the product line launched due to high demand (perhaps the site was intentionally crashed?). This has created enormous buzz and an air of exclusivity. There have been reports of lines at the door before stores open across the country. When you invest in Target you get one of retail’s best merchandising and branding teams in the nation. The success of the Missoni line has the potential...

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Retail Chain Sales Very Strong – No Recession

September 1, 2011
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Retail Chain Sales Very Strong – No Recession

It was particularly impressive that sales in August were not only strong for retailers that sell lots of food and consumer products (which benefited from the buying panic pre-Irene) but that they were broadly strong. While the food and broadline retailers should have benefited from some buying “pull-forward” before the storm, other retailers such as department stores and specialty apparel retailers were clearly hurt. You don’t need to rush out and buy apparel before a storm, and these retailers had up to hundreds of stores closed over a key back-to-school shopping weekend. It bodes very well that results were stronger than expected, and strong in an absolute sense, despite missed selling days on a key weekend. September will benefit as sales of apparel and discretionary items gets pushed out...

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