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Yep - Came across an article month or so back that RS was sharply reducing inventory in their stores. Didn't think it warranted a separate post, so held off. RS called it streamlining. Some were speculating however that they were really raising short-term cash to stay afloat.
A sad story for many of us. Twenty years ago when hooking up just about any gizmo, one ran to RS. There you gladly forked-over $20 for a $5 cord, connector or adapter with, I think, a tacit understanding that $15 of the cost represented the considerable RS knowledge & expertise that accompanied the item. Today, go on-line, google the issue, identify the part needed, and than have Amazon ship one out the same day for a fraction the cost.
The knowledge we once gladly paid for is now essentially available for free over the Internet. Guess that's what you'd call a broken business model.
Reply to @hank: Exactly, those are the by-gone days when Radio Shack was the go-to store for everything pertaining to electrical and electronics. Sadly they are going down the same path like other iconic US companies - Polaroid, Kodak,and (soon) Sears.
I think it has to be asked what is the real value of the equity. I don't think it's $5.08.
Radio Shack was going to go into emerging markets and I thought that was not a bad idea. I don't think there's a turnaround in the US. You focus on mobile phones, Best Buy already has mobile stores. People order cables and other formerly-Radio Shack items on Amazon.
Buying used phones and other devices is Gamestop, Outerwall (I hate that name) and others.
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Sears"
I think that story has to play out sooner than later. ("Sears Rally Belies Big Worries", 10/12)
Bull Case: Bear Case: Assets Baker Street Credit Suisse Real Estate $10.1 billion $3.2 billion Kenmore, Craftsman & Diehard 3.0 2.4 Home Services & Protection 2.4 1.0 Lands' End 1.6 1.4 Sears Online 1.5 0.3 Sears Canada 1.0 0.5 Sears Auto 0.7 0.5 Other 0.9 0.3 Value of Assets (bil) 21.2 9.7 Value per Share* $169.0 $28.3 *After adjusting for working capital, debt, cost of store closures, and other items. Source: Baker Street Capital Management, Credit Suisse
And seriously, this article this morning re: Sears.
Berkowitz is a highly intelligent investor and probably one of the best around, but I haven't agreed for quite some time with the view that Sears has all of this hidden treasure of value to unlock, especially given that Lampert's performance as CEO has made the company significantly less relevant than it already was.
Comments
A sad story for many of us. Twenty years ago when hooking up just about any gizmo, one ran to RS. There you gladly forked-over $20 for a $5 cord, connector or adapter with, I think, a tacit understanding that $15 of the cost represented the considerable RS knowledge & expertise that accompanied the item. Today, go on-line, google the issue, identify the part needed, and than have Amazon ship one out the same day for a fraction the cost.
The knowledge we once gladly paid for is now essentially available for free over the Internet. Guess that's what you'd call a broken business model.
In this environment, Radio Shack can apparently kick the can:
http://www.reuters.com/article/2013/10/21/us-radioshack-financing-idUSBRE99K0Z420131021
I think it has to be asked what is the real value of the equity. I don't think it's $5.08.
Radio Shack was going to go into emerging markets and I thought that was not a bad idea. I don't think there's a turnaround in the US. You focus on mobile phones, Best Buy already has mobile stores. People order cables and other formerly-Radio Shack items on Amazon.
Buying used phones and other devices is Gamestop, Outerwall (I hate that name) and others.
-----
Sears"
I think that story has to play out sooner than later. ("Sears Rally Belies Big Worries", 10/12)
http://online.barrons.com/article/SB50001424053111903891504579121603785394482.html#articleTabs_article=0
Bull Case: Bear Case:
Assets Baker Street Credit Suisse
Real Estate $10.1 billion $3.2 billion
Kenmore, Craftsman & Diehard 3.0 2.4
Home Services & Protection 2.4 1.0
Lands' End 1.6 1.4
Sears Online 1.5 0.3
Sears Canada 1.0 0.5
Sears Auto 0.7 0.5
Other 0.9 0.3
Value of Assets (bil) 21.2 9.7
Value per Share* $169.0 $28.3
*After adjusting for working capital, debt, cost of store closures, and other items.
Source: Baker Street Capital Management, Credit Suisse
And seriously, this article this morning re: Sears.
http://www.businessinsider.com/photos-that-show-why-sears-is-vanishing-2013-10
Berkowitz is a highly intelligent investor and probably one of the best around, but I haven't agreed for quite some time with the view that Sears has all of this hidden treasure of value to unlock, especially given that Lampert's performance as CEO has made the company significantly less relevant than it already was.