U.S. retail stocks took another beating on Thursday after the market was unimpressed by the latest numbers from Macy’s Inc M 2.64%and Kohl’s Corporation KSS 1.58% as they continue to struggle to adjust to the intense competition from Amazon.com, Inc. AMZN 0.55% and other online competitors.
Earlier this week, activist investor group Snow Park Capital Partners called for retailer Dillard’s, Inc. DDS 0.54% to make a dramatic adjustment to its business strategy. Snow Park said that the value of Dillard’s real estate alone is worth about $200 per share, and the company should consider selling or spinning off its valuable real estate properties to unlock that value.
Dillard’s isn’t the only retailer that is being pressured to monetize its real estate property. Activist hedge fund Starboard Value has been pressuring Macy’s to do the same since 2015.
Unfortunately for Macy’s, Dillard’s and other retailers, spinning off real estate might not e the quick fix that activists claim it is. In fact, Sears Holdings Corp SHLD 0.92% spun of a large portion of its real estate assets into Seritage Growth Properties SRG 0.84% in 2015, a move that did very little for long-term Sears shareholders. Sears landed $2.7 billion in cash, but lost its most valuable asset. Since Sears pulled the trigger on the spin-off, the stock is down another 76.2 percent. Ironically, shares of Seritage are up 26.9 percent in that time.
It’s…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
