The Daily Dose: Friday #Rewind

 | Nov 15, 2013 | 9:00 AM EST
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You went to bed dreaming of Janet Yellen's soft-looking white hair and how she may influence your long-only portfolio. No need to send me an email to confirm, I know this is what happened. Upon waking up in the morning, your first thought was on Warren Buffett's attempt to control our lives via the Exxon (XOM) holding disclosure. Great investment on the part of Mr. Buy-and-Hold Forever. With a forever investment time horizon, fossil fuels will likely run dry, and the value of Berkshire's holdings overseen by the Gates Foundation will be 10 times higher from when Warren died. Gruesome, but hey it's reality.

This humble servant of achieving personal goals, securing coffee, and analyzing markets wants to kindly remind you that zillions of other events occurred this week that are of high relevancy. Grab your notepad and enjoy the Friday #rewind.

Kohl's Really Bombed, the Truth as to Why

Third Quarter Sales

  • Macy's (M): +3.5%
  • Kohl's (KSS): -1.6%
  • J.C. Penney (JCP): -1.6% (trend)

6 Bomb Triggers

  1. Kohl's "racetrack" store layout has become very cluttered with merchandise from electronics accessories to slippers, and this hurts the shopping experience. Can't wait to leave and visit Macy's!
  2. Cosmetics section is woefully behind visually relative to what the aforementioned Macy's and Lord & Taylor are now installing via remodels. Customer service is also absent. Target (TGT) has now put beauty consultants in its cosmetics department to bolster sales.
  3. Home department not showing a consumer on the basic of levels how product can be used in their everyday lives.
  4. The home department itself is cluttered, again hurting the shopping experience.\
  5. There is a limited selection in jewelry and other accessories, and the presentation of them to the consumer is sub-par relative to peers (except for the atrocious Sears (SHLD) ).

Wal-Mart has Deep-Rooted Issues, Here are a Few

Wal-Mart (WMT) execs must be smoking the good stuff because I read the pre-recoded earnings call as supportive of my long-term sell rating on the stock. First, this is one stat that you should have realized right off the bat from the press release (if you read it...):

Not only did it present its financial overview in a new (somewhat misleading way designed to showcase the positive inside of the U.S. business) manner, but it suggests the core of the business (giant retail stores in rural America) continue to struggle.

  • "Wal-Mart U.S. comp sales declined 0.3 percent in the 13-week period ended Oct. 25, 2013. Comp sales for the Neighborhood Market format rose approximately 3.4 percent."

These are the three takeaways I had from the earnings call:

  • ROI -50 bps.
  • International stores are being exited due to poor site selection and layouts (and other arrogance from HQ). Execution stumbles.
  • Despite massive price investments and marketing, Wal-Mart is still unable to drive positive traffic to its U.S. base. Competition is a factor, but also the health of that $25,000 a year income household.

Knowledge-Creating Tweets from my Stream

I tweet a fair amount, especially during earnings season. None of this is for my own health (it actually may be hurting my health!), I am trying to educate in real-time and get actionable, free financial information into the hands of a growing personal social universe. Here are the most impactful tweets and retweets of the week from yours truly.

Always be in search of unusual signs of a market top or market bottom.

Tweet One

Keep pumping in that liquidity, 17% more until we unleash another debt fueled consumption boom.

Tweet Two

I remain long-term negative on Staples (SPLS). Yes, that is a rare spelling error, it should say "noting."

Tweet Three

Another quarter in which Wal-Mart underperforms its lowered expectations.

Tweet 4

One Video to Watch

In my spare moments, I stopped by Fox to do a segment on Lululemon and flammable car company Tesla (TSLA). Lululemon (LULU) was downgraded on Thursday, after my segment. Hmm. Any-who, I continue to be negative on Lululemon as well!  One reason I neglected to mention on-air:

  • Gap's (GPS) Athleta is really starting to ramp its new unit growth with a larger store size than Luluemon, AND in Lululemon's markets. I believe Athleta is doing a quality job of connecting with the yoga community, which has been the secret sauce to Lululemon's success since inception. 

Columnist Conversations

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As far as TSLA is concerned, I still have a higher target above the market at the 409 area.  I stated in ...
The TLT setup discussed in my last commentary is a bust. Key support was violated and it violated the recent l...
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