Novice Investing - Retailer Giving Thanks

Date: Monday 01st 2008f December 2008 05:01:41 PM

Retailer Giving Thanks - 11/24/2005

By: Novice Investing Staff

For most retailers, thanksgiving is the day to give thanks for. The November - January period normally accounts for as much as 40 % of annual sales and 75% of annual profits. Retailers live and die during this period. Consumers, flushed with year end bonus, spend the most money shopping during this crucial November - January period. Therefore, if you invest in retailers, this is the period that you should be watching for. Your investment will depend on it.

Last year, E-tailer Amazon.com Inc. (AMZN) has 37% of its sales during the November - January period, 33.6% for BestBuy Co Inc. (BBY), 34.1 % for Circuit City Stores Inc. (CC), 39.9% for Children's Place Inc. (PLCE) and 40% at LeapFrog Enterprises Inc. (LF)

Specifically, you should watch for retail stocks that have the potential for turning around. If turnaround retail stocks are having difficult time this holiday season, then investors need to wait one more year. Investors for Jo-Ann Stores (JAS), Pier One Inc. (PIR) and Sharper Image (SHRP) are hopeful that their companies can turn their fortune around this holiday season.

The outlook for this holiday season is decent. Falling energy price and a relatively resilient US economy helps to enforce the trend. For e-commerce, the sales growth is predicted even higher than traditional retailers.

For the rest of us, we need to put aside our investments for a while and celebrate thanksgiving. If you have done the proper fair value calculation, your stock performance will reflect it sooner or later. Don't fret over it in this joyous occasion. Happy thanksgiving.



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Disclaimer: The sole purpose of this article is educational. This article is merely the opinion of the writer and is not in any way a buy/sell recommendation regarding Amazon.com Inc.(AMZN) or any other securities.

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