Retail

Lampert tightens grip in slow strangle of Sears

16 January 2019

The hedge-fund manager’s $5.2 bln bid won the bankruptcy auction for the embattled retailer. That may keep the doors open for now. But in his 13-year tenure atop Sears, Lampert has starved it of cash and sold assets. Unless he changes tack, a slow-motion liquidation looks likely.

Reckitt CEO leaves successor with big headaches

16 January 2019

Rakesh Kapoor will leave the Nurofen maker after eight years. The stock has soared in his tenure, but the exit comes after a series of mishaps, weak sales growth, and a controversial acquisition. The successor will also have to decide whether to proceed with a complex breakup.

New Look makeover is bad trend for UK high street

14 January 2019

The ailing retailer is writing off three-quarters of its 1.35 bln pounds of debt in an effort to repair its finances. Like rival Debenhams, it can only survive if UK high street sales pick up. But after a bleak Christmas and with Brexit looming, a revival looks far from assured.

L’Occitane picks odd time to bet on British beauty

14 January 2019

The Hong Kong-listed soap and hand cream brand has snapped up luxury skincare group Elemis for $900 mln in cash. At over 22 times last year’s EBITDA, the price looks a tad rich. The acquisition will also boost L’Occitane’s exposure to the UK at a time of economic uncertainty.

Chinese mystery beauty queen is ripe for makeover

11 January 2019

Pechoin is giving global cosmetics brands a run for their money in China’s $30 bln skincare market. Its revival from state-owned obscurity is impressive; it did so without outside investors or partners. As the economy cools, however, it could make an attractive acquisition target.

Investors stop giving U.S. retailers an inch

10 January 2019

Macy’s shares fell by nearly a fifth after weak December sales prompted it to cut forecasts. Target and Kohl’s also felt the downdraft despite more upbeat numbers. Online disruption and the decline of old stalwarts Sears and J.C. Penney have made investors justifiably jittery.

Tesco festivities will spill into 2019

10 January 2019

Britain’s biggest grocer outsold rivals over a difficult Christmas period and fought off discounters like Lidl with cheaper offerings. Its operating margin targets are attainable even though Brexit-wary consumers are counting pennies. The company deserves a higher valuation.

PetSmart shows lenders need more bite than bark

9 January 2019

Apollo Global helped finance the private-equity-owned company, only to see it transfer part of a key subsidiary to owner BC Partners as a dividend. Now Apollo is suing to get the assets back on leash. Lenders would do better to insist on much tighter covenants from the get-go.

Ted Baker shoppers pick money over mores

9 January 2019

The British fashion house posted higher than expected sales over Christmas despite founder Ray Kelvin’s hugs-related scandal. Festive promotions certainly helped. However, the brand looks more resilient than its current stock price implies. It’s a mixed blessing for Kelvin.

Activist too quick to take an ax to Dollar Tree

7 January 2019

Pushy investor Starboard wants control of the $23 bln low-price retailer’s board, and could push for a sale of its Family Dollar chain. Dollar Tree has underperformed peers. But Starboard, which only has 2 pct of the stock, may do better holding tight and waiting for a downturn.

Warren Buffett finds value in Sears wreckage

7 January 2019

The Berkshire Hathaway boss owns a stake in Seritage, the real-estate firm spun off from the bankrupt retailer. Revamping vacant Sears properties is driving growth and reducing dependence on the ailing chain. But true to form, Buffett has protected his investment with a loan.

Next divides UK retail into strugglers and losers

3 January 2019

The retailer reported better-than-expected Christmas sales, helped by its larger online presence. But weak store sales suggest many high street peers, like Debenhams, are still on shaky ground. And even Next’s more diversified business is barely growing.

Investors’ J.C. Penney discount is familiar spiral

2 January 2019

The outfitter’s stock, like Sears’, has fallen below $1. With debt mounting and sales dwindling, its decline follows a familiar pattern. From Bill Ackman to Eddie Lampert to KKR, ailing retailers have drained many a deep pocket. What looks like a bargain is rarely the case.

Italy’s woes could spell LVMH moment for Moncler

2 January 2019

Italian luxury brands have so far resisted becoming conglomerates like the French behemoth and rival Kering. But generational shifts by founders, combined with an aversion to political risk by global investors, may afford Moncler boss Remo Ruffini his opportunity to change that.

Investors will swap City offices for Euro sheds

27 December 2018

Yields on shiny London real estate are on the floor, and Brexit could affect sky-high capital values. Luckily, those looking to invest in property in 2019 have a Plan B. European warehouses are both cheap and likely to gain from an ongoing surge of online commerce.

Jeff Bezos starts to resemble Sam Walton

21 December 2018

Amazon is selling shelf space, opening stores and launching catalogs. Old-school Walmart’s acquisitions of Jet.com and Flipkart are helping it challenge its rival’s online dominance. As the two retailers increasingly resemble each other, so too will their valuations.

Indian unicorns will feast on richer pastures

18 December 2018

Saffron tech startups are going global. Restaurant search firm Zomato, ride-hailing firm Ola and hotel-rooms aggregator Oyo lead the charge overseas. A complex home market will provide for successes in far-flung lands and, crucially, plump the bottom line to win at home too.

ASOS bloodbath undermines online saviour status

17 December 2018

The fashion group’s grim outlook knocked 40 pct off its shares. Internet retailers were supposed to be more robust than bricks-and-mortar peers, which have high staff and rent costs. Rising competition and fickle customers suggest slower growth and lower margins are here to stay.

Japan’s 2019 could be better than it looks

14 December 2018

An ugly contraction in quarterly growth, plus signs companies are slashing spending, raise doubts over Tokyo's ability to weather a global correction. But the world’s third-largest economy has been underestimated before. If that’s true again, its stock market may be too cheap.

Amazon HQ2 meets NIMBY 2.0

13 December 2018

A month after picking New York for its new location, the $810 bln e-commerce giant is being bashed by local politicians and unions. It’s a rude shock for a firm used to getting its way. This kind of opposition can be eased with money. As Amazon gets bigger, the cost rises.