Value Traps

  • 30 Oct
    They May Be Cheap, But Don’t Buy Retail Stocks Now – Here’s Why

    They May Be Cheap, But Don’t Buy Retail Stocks Now – Here’s Why

    • Don’t look at past figures and expect them to suddenly reappear. Retail is a tough business with tight margins.
    • Retailers have experienced a margin decline recently. But there’s still plenty of room for them to fall further and the situation may get really ugly.
    • Some will win, but who can identify the winners now?



    Introduction

    Retail stocks keep getting cheaper and cheaper, and many investors look at current valuations and think they are too cheap to be true. In today’s article, we’ll dig into the sector, see if there is value, or if the “too cheap to be true” retailers are all just Potemkin’s villages.

    Before digging into specifics, I want to share a retail example from my neighborhood. More →

  • 20 Jun
    How To Identify Value Traps

    How To Identify Value Traps

    • Value stocks are tempting, but the vast majority turn out to be value traps.
    • There are a few things to look at that lower the probability of getting caught in a value trap.

    Introduction

    Everybody has been talking for the last few days about Amazon’s (NASDAQ: AMZN) buyout of Whole Foods (NASDAQ: WFM), and the negative repercussions that purchase had on competitors like Wal-Mart (NYSE: WMT), Target (NYSE: TGT), Costco (NASDAQ: COST), and Kroger (NYSE: KR). More →