A Craftsman hammer may be a powerful tool that consumers can expect to last a lifetime -- but sales at Sears
The iconic retailer reported its domestic same-store sales results for August, and they were disappointing. According to the release, these locations saw a decrease of 6.1%. That's pretty steep -- and yet another confirmation of the horrible revenue trend the stores are in.
This serves as a Foolish corollary to long-term buying and holding: While the strategy is definitely sound and smart, it behooves all of us to routinely review our investments to make certain that the future story of a long-term buy continues to retain a high probability of a happy ending (i.e., wealth is created down the road for retirement). Sears may have been a solid investment proposition at one time or another, and its brand may have ruled the retail roost, but stories can be rewritten at any point in the continuum. I don't like the current draft of this story, and from a personal standpoint, I would not be a buyer of the equity.
The stock closed yesterday up almost 5% to just below 40 bucks a share. I find that a bit strange, and I suppose it's probably due to bargain hunters who detected the good sentiment that was out on the Street during the session. It's well off its 52-week high of $56, though, and if I were to take a guess, I'd say the equity will eventually be heading for lower levels. Unless, that is, Sears figures out some new catalyst to get those sales headed in the correct direction. Maybe that big box idea might do the trick.
We'll have to wait and see. Here are some other retail reports:
- Is J.C. Penney
(NYSE:JCP)on the rise?
- Is Kmart Holdings
- Can Circuit City
Fool contributor Steven Mallas owns none of the companies mentioned.