US Retail Sales Stagnant

Americans have become far more selective about their spending; and old-fashioned 1980s style conspicuous consumption and shopping for shopping’s sake is out. Americans are shopping less and spending only on the things they really need or care about.

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Sears the Agony Continues

Just to remain viable as a retailer; Sears would have to close 43% of its stores or around 300 locations, Green Street estimated. That figure might be optimistic because of the loss of consumer confidence in Sears. There is no evidence that customers would return if Sears shuttered a bunch of money-losing locations.

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Lowe’s proves Home Improvement is a Safe Investment in the Midst of Retail Apocalypse

If you are looking a retailer to buy and hold for a long time, I’d recommend Lowe’s. It has a wide moat, a lot of cash, lots of float growing revenues and great growth prospects. At $77.06 a share, Lowe’s is also a bargain when compared to Home Depot’s $126.4 stock price. Lowe’s is definitely the value investment in home improvement.

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Ten Threats to Walmart

Much of Walmart’s success has been based upon its ability to deliver name brands at much lower price than competitors. This is threatened because Americans are no longer buying name brands. Three of the fastest growing retailers; Aldi, Costco and Trader Joe’s, base their business model on a limited selection of low-cost but high-quality private label products.

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Is Home Depot Overvalued?

My advice to investors would be to wait until Home Depot’s share price falls to a realistic level to buy. This is a good company; but it’s a good $100 a share stock, not a $130 a share stock.

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Does Lowe’s Make Money?

This uneven real estate market could be a threat to Lowe’s because much of its success is based on the presumption that Americans will constantly want to improve their homes to increase value. If real estate prices stop going up or start falling dramatically, there could be little or no incentive for home improvement.

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