- As some analysts categorize retail as uninvestable, it’s time to look for bargain investment opportunities.
- Sales are shifting to e-commerce, but earnings are what are going to determine your investment results.
- The combination of brick and mortar and e-commerce might be the investment winner as it gives you fundamentals and growth.
A Wells Fargo analyst, Ike Boruchow, recently called the retail sector “uninvestable,” at least in the short term. He based his statement on changing consumer dynamics that compress valuations, the favorable weather, easy comparisons to 2015 which have made retail look ok, and the 25 companies that have cut their guidance in the last two weeks.
I’m attracted by such statements because the best investments are usually found where all others have given up. Especially when a whole sector is surrounded by negative sentiment, even prices of good companies decline and create amazing long term opportunities.
In today’s article, we’ll analyze how the retail sector is priced in relation to its long-term fundamentals. More →