Sunday, November 27, 2011

"Well now that the turkey day, Thanksgiving, has passed and the Black Friday weekend is here, how are the stock prices of the retailers doing this year"

Dow Jones Industrial Average  11,232 (Down)  Week ending 11-25-2011

Well we celebrated the Thanksgiving holiday this week our traditional gathering to eat a sumptuous meal of Turkey here in the US.  It turned out that the week in the stock market also was a "turkey" as we had the worst Thanksgiving stock trading week since 1932. You will remember that year, " In 1932 the economy continued to deteriorate and unemployment increased further in 1932 to 24.1% , there were few jobs and many ordinary Americans were forced into living in the streets or in old cars. Towards the end of the year in November the American voter used the power of Democracy to show Herbert Hoover what they thought of his term of presidency during these bad times and voted strongly in favor of Franklin D Roosevelt by 472 electoral votes to 59. "   Sound familiar?  Maybe we will follow the lessons of history and make a change in our government and get things turned around.

I thought this week with the kickoff of Black Friday and the holiday shopping season that I would do something different and report just how some of the retail stocks are doing with their stock price year to date (YTD). I picked out a mix of stocks that I hear talked about often. I pulled my stats from the CNBC quote website.

Ulta Salon Cosmetics & Fragrance Inc.  (ULTA) -  +87.41%
lululemon athletica inc. (LULU) - +71.71%
Sally Beauty Supplies (SBH) - +41.22%
Express (EXPR) - +37.95%
Dollar Tree (DLTR) - +36.58%
Bed Bath and Beyond (BBBY) - +30.64%
Ross Stores (ROST) - +30.27%
TJX Cos. (TJX) - +26.37%
Costco -(COST) - +19.66%
Petsmart -(PETM) - +16.92%
CVS Caremark Corp. - +16.76%
Limited Brands (LTD) - +13.47%
Tiffany (TIF) - +13.32%
Foot Locker (FL) - +11.81%
Walmart (WMT) - +5.33%
Amazon (AMZN) - +2.90%
JC Penney (JCP) - (-9.78)%

One thing is apparent, you would have done pretty well buying most of the retail stocks on the list.  If you had bought a stock this year though like Best Buy you would have been down 41% so not all were winners. Surprisingly, Wal-Mart and Amazon not very high up on the list even with their high volume of sales. It appears that the 2011 holiday shopping season has been pretty good so far.

 If you are looking at the fundamentals of these companies just make sure that they do not have a large build up in inventories over multiple quarters. That is a Red flag that business is slowing up. I imagine that the best time to buy retail stocks would be now and then sell them into earnings in January.
I won't tell you which one to buy, but the one above seems to have a surplus of female customers that love their athletic clothing line.

Catch you next week,   Freewilly

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