Is Dollar General’s Growth Sustainable?

My advice is to sell Dollar General now, because its business model is not sustainable. This dollar store operator is headed up for a crackup and an implosion.

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Is MoneyGram a Good Investment for Ant or You?

All this makes MoneyGram a very questionable investment because it does not generate that much cash or float for a financial services company. One reason for that is that it does not lend money and serves mostly working class customers.

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Costco Defies the Odds

Costco has one thing in common with Amazon, it is a very cash rich company. On February 28, 2017 it reported $4.976 billion in cash from operations, $2.384 billion in in net income and $5.965 billion in cash and short-term investments. This was in spite of a free cash flow of -$23 million and a profit margin of 1.73%.

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Is Chipotle Imploding?

An intriguing possibility would be for Kroger to acquire Chipotle. The supermarket giant could easily afford such as transaction, Chipotle had a market capitalization of $11.55 billion on March 17, 2017, and an enterprise value of $11.12 billion on December 31.

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Can Supervalu Survive??

Supervalu might be a good investment for Kroger; but it is certainly a lousy investment for anybody else with the possible exception of Safeway.

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Dollar Tree at the Limits of Growth

This means that like many discounters, Dollar Tree operates fairly close to the death spiral. That is too close for my tastes because it had just $870.4 million in cash and short-term investments at the end of the last quarter.

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Do Organic Grocers Make Money?

All this makes Whole Foods a very suspect investment even though its stock has done well. WFM investors received a return on equity of 13.69% on December 31. The company is scheduled to pay a 14¢ a share dividend on April 5, 2017. One has to wonder how much longer that can continue. Sprouts pays no dividend but its’ investors did receive a 16.07% return on equity on December 31, 2016.

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Can Target Survive the Retail Apocalypse?

My prediction is that Target will continue to make money but the revenue losses will keep growing. At some point; probably in 2019, Target will have to start closing stores and possibly reducing its national footprint much like JC Penny’s and Macy’s are to survive.

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Can Kroger Keep Growing?

This service enables Kroger to reach groups that might avoid traditional grocery stores such as Millennials who do not own cars, and residents of fast growing urban areas far from suburban supermarkets. It also taps shoppers with more disposable income; who are more likely to order higher priced goods, which can compensate for food deflation.

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Walmart’s Price cuts should scare you to Death

All this indicates that there might be millions; perhaps tens of millions of Americans, that can no longer afford to shop at Walmart. That’s a pretty frightening situation and it bodes ill for a great many retailers and their vendors.

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