Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 50% Gains Investing -- Ignore unavailable to you. Want to Upgrade?

To: Dale Baker who wrote (2907)	2/4/1999 12:28:00 PM
From: Dale Baker	Respond to of 118717

For anyone who wonders why I bought a boring sector like XLY: SAME-STORE RETAIL SALES. Retail sales remain very strong. Data are coming in for same-store sales for January for many retail chains this morning. Same-store sales count the difference only in sales at stores that have been open for more than a year, and therefore exclude corporate growth due to new store openings or acquisitions. They are considered a barometer of the underlying trend in sales for various companies. These data are useful in determining how well a specific company is doing, but when assessing the overall retail environment, they have to be weighted by size. And in that respect, several stores are dominant: Wal-Mart, Sears, and K-Mart. In Briefing's proprietary same-store index, Wal-Mart is assigned the largest weighting by far of 28.8% of the whole index, because its sales are so much larger. Wal-Mart this morning has reported a very strong 10.3% gain for January. The second largest chain, Sears, has a weighting of 8.4%, and the third largest, K-Mart, comes in at 6.6%. There is no data from Sears, but K-Mart has posted a big 8.5% increase. Wal-Mart and K-Mart together represent a big part of the overall retain chain store data, and big gains for these two companies indicate that the overall retail environment in January remained extremely good. Data from other chain stores is mixed. JC Penney, which has been having problems for awhile, posted a 0.1% drop, but it has only a 3.3% weighting. Talbots showed -12.4%, but it represents just 0.3% of the overall chain store data. A list of individual company reports is posted on the Short Story new summary page, but the overall conclusion is clear. Same-store sales are very strong in the aggregate and show the U.S. consumer continues to spend freely. The economy is still booming. Many investors are impressed by increases in e-commerce growth, but on-line sales are still minuscule relative to overall retail sales. Wal-Mart is the king, and the increase in their sales still blows away the numbers posted by even the best e-commerce companies. These data show no signs of any economic slowdown.