The only possible differentiation HH Gregg has is it's highly commissioned, aggressive sales staff. And here is what you say about that: 2) hhgregg salesman was honest and i shopped without his help. Ouch!
i just got a new HDTV from hhgregg after going to best buy. im a reward zone member and best buy and preferred to get one from there but went to HHG for 2 big reasons:
1) hhgregg had better selection with TVs and DVD/bluray players while BBY huge store had only 5 overpriced blurays on sale among the 100s of TVs that didnt fit my need.
2) hhgregg salesman was honest and i shopped without his help. BBY has way too many employees on payroll lurking around like hounds.
sure hhg does not carry as much different electronics as best buy but look at all the wasted inventory in best buy stores. they probably eventually have to liquidate it below the purchase price.
2 current ratio, ZERO debt, much better margins than BBY, and similar low PE. the only thing was both stores were basically dead on a saturday evening. i dont remember it being like this a few years ago. the industry is out of favor currently due to the economy, so looking for a lower buy point in the $12s.
One more thing: Did some reading thru HGG and BBY last annual statement 10-K. HGG has a per square foot lease rate of $12 per year. BBY is $23. This includes distribution centers and does not include benefits from leasebacks. If HGG had to pay $23 per sq foot this would represent $1.59 per share in lease costs (5.737 Million Sq ft) 39 Million Shares.
The answer is fairly simple. The stock price is down because investors are selling; they want out. Why do they want out? The economy is not improving. Unemployment remains above 9%. People have no money to spend on big ticket items. Those who have money are saving it for a rainy day in case they also become unemployed. Therefore, there is fear that hhgregg's revenues will drop and earnings will be a lot lower.