The Dow Jones today projected a 25-point decline in premarket hours following a report from the U.S. Commerce Department that announced Q2 GDP grew at a rate of 4.1%.
The 4.1% figure is the fastest quarterly growth since July 2014.
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Kohl's boosted fiscal 2017 guidance from $3.72 to $3.92 to a new range of $4.10 to $4.20 on Monday, in a move that caught Wall Street analysts flatfooted.
That's got a lot of investors wondering if the "retail ice age" we talk about frequently is over. And more specifically, whether or not they should buy Kohl's stock…
…not on your life.
The "Retail Ice Age" is a long way from over, and there's only one way to play it.
It's true the retail industry as a whole is benefiting from stronger consumer confidence, a booming stock market, and better jobs data. But "over," like Wall Street wants you to believe?!
No way.
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Chief Investment Strategist Keith Fitz-Gerald has found a huge profit opportunity in a sector most have long since abandoned.
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Black Friday/Cyber Monday hit about two weeks ago – and all I've heard since is doom and gloom.
The "retail apocalypse" is here, and every "expert" out there is telling investors to "short" brick-and-mortar retailers… Wait, no, they should "buy" retailers on the dip.
Then there are those who try to explain that this isn't really an apocalypse and that this specific retailer is going to survive (but this one or that one isn't).
Over at Jim Cramer's TheStreet, I saw one writer recommend an ETF – EMTY, as in "empty" stores – whose share price rises whenever a brick-and-mortar retail stock index falls.
All this is ridiculous – and way more complicated than necessary.
Yes, Macy's, Sears, and Office Depot are plummeting. And, indeed, J. Crew and Toys R Us are heading toward insolvency.
But check out these numbers...
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The incoming online shopping tide – scratch that, tsunami – that just swamped traditional brick-and-mortar retailing has changed America's shopping landscape forever.
Not only were online sales records broken on Black Friday and Cyber Monday, but they were also broken on Thanksgiving Day. Meanwhile, brick-and-mortar stores debated even opening on a "family-gathering" day.
While online sales numbers themselves are staggering, the story they tell about changing consumer habits might as well be the last nail in the coffin of left-behind retailers across the country.
Here's what that means for the future of America's already shaky traditional retailers...
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Everyone knows what Black Friday is. It's the day after Thanksgiving when retailers kick off big sales events to get consumers into their stores.
And, these days, most people know about Cyber Monday too, the Monday after Black Friday when online retailers and merchants entice shoppers with more sales.
What most people don't know is that when this holiday shopping season sets records for online sales, it will be the beginning of the end for at least a dozen brick-and-mortar retailers.
In other words, this Black Friday was Black Death Friday for some of your favorite stores, the companies that own them, and their stocks.
The Rubicon's been crossed. This is the end of retailing as we used to know it.
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Unless there really is a Santa Claus, Sears Holdings Corp. is going to seek bankruptcy protection.
It's only a matter of time. And that time is running out, quickly.
Billionaire hedgie Eddie Lampert, who besides running his namesake ESL Investments fund also runs Sears Holdings as its chairman and CEO, just put another $200 million into Sears last month.
That brings his fund's helping hand, I mean handout, to a tad more than $2 billion!
Poor Sears was once the Amazon of its day. Now, it's not only a dinosaur, it's already dead.
We're going to do a little grave dancing before the obituary arrives.
Here's how much of a mess SHLD already is and how you can profit from its extinction...
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If you aren't a subscriber to my Zenith Trading Circle service, you might have missed some lucrative good news: Retail think tank Fung Global Retail & Technology reported U.S. retailers plan to shutter 6,700 retail locations this year. Credit Suisse says that figure handily beats the old record of 6,163 closings set in – big surprise – 2008.
"But wait," I can hear you ask, "2008 I get, but the economy's humming along now, so why the closings? And why are these closings good news?"
Well, I'll tell you.
As to the first question, these overleveraged, maladapted-for-the-21st-century retailers could screw up a free lunch; the U.S. economy could grow 'til the cows come home and they just couldn't handle their debts.
The retail sector as we once knew it is now teetering on the edge of absolute destruction, and there's nothing – and I mean nothing – anyone can do to save retail stocks. Diagnosis: TERMINAL.
Which brings me to your next question, of course. This is great news for well-positioned investors because Wall Street smells money – big piles of it – on the table… and it smells as irresistible and tasty as scratch-made chocolate chip cookies baking on a snowy afternoon.
Mmm… Hungry? Good. We're going to sneak into the kitchen while Wall Street's not looking and take a bunch of those rich, delicious cookies for ourselves.
We're going to make a lot of money.
And we won't have to own a single one of these clunkers to do it.
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Just two weeks after filing for Chapter 11 bankruptcy protection, beleaguered toy retailer Toys R' Us has debuted a plan it hopes will save the company.
Spoiler alert: It's awful, and it won't work.
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"I don't want to grow up!" sang Toys R Us' famous jingle from our TVs, year after year.
Unfortunately, that's not how the world works, and neither kids nor retailers get to skip out on that reality.
Retailers don't necessarily have to die, but plenty of them have been digging their own graves. The bankruptcy of Toys R Us wasn't an accident or a surprise.
In a move one can justifiably call a suicide, the company choked itself to death with debt.
The demise of Toys R Us is a lesson for all retailers, and it's a lesson for investors.
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