The Daily Dose: Extreme Edition

 | Dec 02, 2013 | 10:30 AM EST
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The Metamorphosis

Six months before the official start of the holiday season I map my attack plan. I sit in a secluded library room (it's a ritual going on 11 years) and stitch together where I will visit and when.

The only two things I leave out, say 10% of the plan, is the story I am trying to disprove or prove to make clients really rich (gotta read third quarter 2013 earnings calls) and certain spontaneous actions. For example, what I did on Saturday in taping a 10-second Vine video from a Wal-Mart (WMT) loading dock. My family thinks I am insane (for real). Friends, well, I don't have too many because I am in a constant stream of analytical motion.

But am I so crazy for doing all of these organic research things? No way, Jose, because per the usual, I predicted the beginning of the holiday season -- this time weak. Don't believe me? Watch the live reports I did on Bloomberg TV on Black Friday  from a mall and then read the Spendingpulse data.

You are right. I am congratulating myself because nobody else will do it. And hey, there is a huge physical and mental commitment to visiting well over 200 stores in three days. And it's also an accomplishment in being super charming to shoppers so they are disarmed and ready to serve up juicy information to share on social media. While mere mortals and faux analysts were counting bags and looking at lines at restaurants, here is what I undertook to outperform them all.

Teen surveying --The top focus by the U.S. teen on Black Friday (and throughout 2013): save as much money as possible on stuff that was cool to wear. This explains why after another year of crowd-controlled lines at an early Abercrombie (ANF) opening, traffic was noticeably soft from Black Friday through the weekend. Aeropostale (ARO) was lost in the sauce as consumers stocked up on basics but sidestepped newer fashion pieces that looked darn awesome. American Eagle Outfitters (AEO) won the award again for most caffeinated store greeters, but buying there was also basics-oriented. Winners were Forever 21, H&M, and Zara, which are all offering more complete assortments and their typical sense of uniqueness. I was concerned the three major teen mall apparel chains had margins that were hit due to so-so traffic in light of the investments in price, people, and marketing.

Absurd amounts of people watching: the first place I did some creeping watching was at J.C. Penney (JCP), given this is a make-or-break holiday season for them. On Thursday and right into the weekend people navigated the basic apparel sections affixed with tricky signs, avoided the trendier higher ticket price departments and definitely didn't venture to the second floor home area.

If I am correct with the intelligence I gathered, then J.C. Penney's holiday season has not begun as enthusiastically as recent press releases hinted could happen. More clearance racks with sub $10 price points by Sunday appeared. As for other places of people watching interest, a personal highlight was Foot Locker (FL). It was very exciting to see recent favorable comments on the Jordan line come to life in the stores, which was seen where folks were congregating and pulling shoes from the colorful wall to try on.

Laser focused on opportunity: we have made clients oodles of cash on Best Buy (BBY) in 2013; it's pretty stimulating. However, Best Buy's latest cautionary comments regarding holiday margins due to price competitiveness nailed the stock. Based on what we found, Best Buy may now be an under promise/over deliver fourth quarter 2013 story. On Grey Thursday and Black Friday, Best Buy stores were like none other I have seen in 10 years of being an analyst. They were consistently crowded, people were engaged in experiences (see new fitness watch section), associates were on the ball and entire departments were being bought.

Black Friday Stock Price Tracker

These were the stock price performances of key retailers on Black Friday -- use these groupings now and forever.

#BlackFriday Stock Price Battle: Teen Apparel

  • $AEO -0.06%
  • $URBN -0.13%
  • $ANF +0.37%
  • $ARO -2.52%
  • $PSUN +0.34%
  • $ZUMZ +0.43%

#BlackFriday Stock Price Battle: Women's Apparel

  • $ANN +0.83%
  • $CHS +0.43%
  • $NWY +1.18%<--open early
  • $CACH +1.55%

#BlackFriday Stock Price Battle: Children Apparel

  • $PLCE +0.40%
  • $CRI -0.27%

#BlackFriday Stock Price Battle: Footwear

  • $FL +0.52%
  • $GCO -1.21%
  • $FINL -0.64%
  • $SKX +0.23%
  • $CROX -0.31%
  • $DSW +0.05%

#BlackFriday Stock Price Battle: Videogames

  • $EA +0.98%
  • $ATVI +0.23%
  • $GME +1.0%
  • $SNE -1.24% #PS4
  • $MSFT +1.41% #XboxOne

On the Stock Market!

I am obviously still watching the stock market and macro data. In fact, I am having this internal debate with my lovely team. The question is if the holiday season has begun on a so-so note, as the data suggests, is this the event that brings negative surprises in January when earnings pre-announcement and reporting season commences?

By no stretch of the imagination are negative surprises factored into present stock valuations and, yes, tech stocks are exposed to trends in the holiday season (think a Microsoft (MSFT) right on down through its supply chain).

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