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Varchild2008 (84.96)

Attention Shoppers, Blue Light Special on Retail Sector...



October 16, 2008 – Comments (2) | RELATED TICKERS: BBY , GME , HD

1) BEST BUY   7.8  P/E    $24.58

2) LOWE's       10.3 P/E    $18.14

3) HOME DEPOT    P/E 10.4   $19.83

4) GAMESTOP       P/E 12.8   $27.73

5) RADIOSHACK   P/E 7.6    $13.14

Best of all... You don't even need a Coupon and they may as well hand you a gift receipt at these prices.  Although, some of these will certainly trade even lower with even lower P/E multiples such as Gamestop and possibly Lowes/Home Depot.  So, any buying in the sector should be done conservatively with the belief the stock prices will drop further.  Don't buy in all at once like Texas Hold Em.

2 Comments – Post Your Own

#1) On October 16, 2008 at 8:03 AM, Gemini846 (34.92) wrote:

I agree esp since most(all?) of those companies pay dividends. It's too bad you can't toe in a position on CAPS.

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#2) On October 16, 2008 at 8:43 AM, leohaas (29.46) wrote:

In times like today, P/E is not a reliable indicator. This is mostly because the E part is dropping quickly. Remember we are in a bit of financial stress at the moment? That means our spending is on the way down!

With consumers not spending, where are companies like Best Buy, Gamestop, and Radioshack going to get their sales? For these companies, the do-or-die time is between Thanksgiving and Christmas. I don't see happy holidays coming up when it comes to my spending.

Lowe's and Home Depot are a different story. With construction almost dead, to whom are they going to sell?

Bottom line: with E racing down, wait until P comes down some more. No doubt it will.

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