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:

EBAY, AMZN, OSTK, REDE, NILE, BFLY, SNCR, ICCA, APTM, GMKT (S. Korean), LQDT and IGLD.

Comments:
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.
 
Broker,
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.
http://www.wcsh6.com/news/watercooler/article.aspx?storyid=46079
 
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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