Why hhgregg, inc. Shares Collapsed

Is this meaningful? Or just another movement?

Jan 30, 2014 at 8:05PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our thesis.

What: Shares of hhgregg inc. (NYSE:HGG) were plummeting again today, falling 19% after posting a terrible third-quarter earnings report.

So what: Shares of the electronics retailer had tumbled earlier in the month on a preliminary update on its holiday quarter, but the actual results were even worse than projected. Sales fell 11.6%, to $707.1 million, much worse than estimates at $762.1 million, as same-store sales dropped in sync at 11.2%. Earnings fell from $0.51 to $0.17, also missing already-reduced expectations of $0.28. CEO Dennis May explained away the performance, saying, "Sales of consumer electronics and computing and wireless products were significantly below our expectations."

Now what: As May had pointed out previously, the many competing channels, and highly promotional sales environment, combined to send hhgregg's sales torpedoing, as the company chose not to follow the heavy-discounting strategy. Still, May was optimistic about the company's future as the retailer is focusing more on home products such as appliances and furnishings, and less on electronics. There may be growth available in those categories, but it's likely not strong enough to replace its flagging electronics sales. As this key report shows, this is a stock headed in the wrong direction, and unlikely to see a reversal anytime soon.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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