Friday, November 24, 2006


Sector Spotlight: Online Retail

For me, today is a do nothing, but eat Thanksgiving leftovers, trading session. I am far too busy eating turkey and my special blueberry-pancetta stuffing, than to fuck around with the assholes on the exchange floor.

After I stuff my face with a sufficient amount of candied yams, I will likely take the family over to the local mall for some early Christmas shopping.

From a stock perspective, I don't like the retailers. I feel the expectations are way too high and there is a good chance the sector may selloff. However, I am bullish on the online retailers, like AMZN and EBAY.

Aside from AMZN and EBAY, who else stands to benefit from the great spender?

The following e-commerce stocks are on my radar:


So you would be against, at this point, making a 2-3wk trade in FD or JWN, under the assumption that other assholes may bid them up? I think if anything amzn has the most room to pull back--they derive something like 35% of their revenue from "media" the majority of which I assume is books, though they don't break it down %-wise in their 10-k. There is no harry potter or da vinci code this year, and massive amounts of price-cutting competition from WMT and TGT. And to boot, AMZN doesn't offer a return, or moneyback, or anything on TV's over 27" NO MATTER WHAT, something I learned from reading AMZN user reviews before I bought my flatscreen at BBY. Shipping, defect, whatever, too bad. Surprising, right? Maybe the masses are unaware of that, but it's not clearly stated anywhere that a normal person looks on their website (probably on page 8 of a click-through legal agreement.) So lets see, high p/e, high expectations, potential for unsatisfied customers, competition from mortar retailers like BBY, WMT, COST, who actually allow a return...

Sorry for the long note, I really appreciate your site, and TIA for any type of reply you give me.
People don't go to Amazon for TV's. It is the best on-line retailer that will make a bundle on TOYS.

If I was forced to pick a traditional retailer, I'd say go long ANF or JCG-- both companies are on fire.

As for valuation:

AMZN is expensive. But, then again-- so is the market. Again, everything reverts back to the asshole dip buyer.
Just in case you missed the comments from Sandisk CEO today:
From the CEO of Sandisk:
Big business in digital cameras expected too. Which is good news for companies like flash memory maker Sandisk.

"The last quarter, third quarter, was a record for us, and this is going to be 50 to 60 percent higher, so definitely expect this to be a strong quarter," said Ed Harrari, CEO of SanDisk.
Thanks for the advice, JCG is looking good. You mentioned small caps ripping. I have no "gut-feeling" or real knowledge about lotto-stocks in general, so think PZI is a lazy way to trade that trend? And finally, before my prodding prompts you to charge me a consultation fee, is it fxe's time? is the dollar fucked? Hope your turkey was good broker.
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DISCLAIMER: This is a personal web site, reflecting the opinions of its author. It is not a production of my employer, and it is unaffiliated with any FINRA broker/dealer. Statements on this site do not represent the views or policies of anyone other than myself. The information on this site is provided for discussion purposes only, and are not investing recommendations. Under no circumstances does this information represent a recommendation to buy or sell securities.