Same Store Sales Color
"Plenty of retailers are packed with customers one month and out of business the next!"
With the obvious exception of consumer electronics, more investors have lost money by confusing their personal experience with an investment opportunity in retail than any other sector. In part this traces back to Peter Lynch's seminal 1988 book One Up on Wall Street. The intent of the book was encouraging readers to use what they see around them as a starting point for investment research.
What that intent morphed into was "I walked past that store and it was PACKED! The stock must be a screaming buy!"
Suffice it to say, that's a dangerous way to make investment decisions.
As part of the 'Ville's mission to translate some of the mysteries of the Street in a way that can be understood by all, we have created a living spreadsheet that will be updated the first Thursday of every month when retailers release same-store-sales. The goal of the feature is to become a one-stop source for sales estimates and how the actual results compared for each period.
Most importantly, we'll try to provide a quick breakdown of the "color" of the data in a way that translates how the numbers are viewed by the Street and the potential effect on the underlying stocks. In other words, we want to answer questions like "Why is KSS up w/ flat SSS when Abercrombie & Fitch (ANF) is dropping a buck despite 2% gains?" (Because Kohl's is heavily shorted, has low expectations and got an upgrade this morning on the notion that KSS is setting up remarkably easy comps going forward.)
This month marks a somewhat thin debut of the feature which will be fleshed-out over the next few months. We welcome feedback and ideas for ways we can make it add maximum value for you all!
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