U.S. Markets closed

Who's Next to be Amazoned?

Tracey Ryniec
  • (1:20) - Jenna Lyons Leaves J. Crew
  • (4:55) - How much is Ralph Lauren Struggling?
  • (10:40) - Retailers With No Online Presence
  • (14:20) - Is Bed Bath and Beyond Amazon Proof?
  • (22:15) - Episode Round Up
  • Podcast@Zacks.com

Welcome to Episode #76 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

In this episode, Tracey is joined by Maddy Johnson, a Zacks Editor, to discuss the recent shake-ups in the retail landscape and who, if anyone, might be next to be “Amazoned” by the Seattle retail giant.

Big Retail News Keeps Hitting the Wires

First, there has been some big news in the retail industry recently, including the announcement that longtime J. Crew Executive Creative Director Jenna Lyons was out after 26 years at the company.

26 years with any company is a feat these days, but 26 years at a retail brand is even more amazing.

J. Crew sales have been falling the last several years and it was clear that the company was going to have to make changes. What does this mean for J. Crew going forward?

Another big announcement was made by Ralph Lauren (RL) who said it would shut its New York 5th Avenue location as it cuts costs. It, too, has struggled with the apparel business.

However, it recently opened a new coffee and bar concept in London, which joined its restaurants including the Polo Restaurant, also on 5th Avenue and which will remain open, and RL, just off the Magnificent Mile in Chicago.

With Restoration Hardware, now called RH, also moving into the restaurant and café space at its stores, is lifestyle branding the way out for many retailers?

Who is at Risk of Being Amazoned?

If you’re not offering an experience to shoppers, you might be in trouble.

Tracey worries about Bed Bath & Beyond (BBBY) which sells many of the same items, like that avocado cutter, that are easily bought on Amazon, with its free Prime shipping. 

For any retailer, that’s a dangerous position to be in.

Bed Bath & Beyond has a $29 level for free shipping and it is constantly sending out 20% coupons but its sales continue to sag. It is adding furniture to the mix at some stores but will that help save it?

Bed Bath & Beyond also owns the Cost Plus World Market chain. Find out what Tracey and Maddy think of that and if that brand will also be Amazoned.

What About Brands with NO Online Shopping at All?

Yes, there are actually some retailers who don’t sell ANYTHING online.

TJX’s (TJX) Home Goods brand does not allow you to buy online. You have to go to the store. It doesn’t seem to be hurting them as same-store sales rose 5% last quarter. Given the grim results we’ve been seeing at other retailers, that’s not too shabby.

TJX is also investing in its home furnishings business, believing it hasn’t tapped the full opportunities there. Later this year it is planning on rolling out a second home furnishings concept. Will that brand allow online ordering? Stay tuned.

Another discount home furnishing company, Tuesday Morning (TUES), also doesn’t have online sales. It too had a solid quarter last quarter with same-store-sales rising 3.8%. It operates about 740 stores across the United States.

Is it dumb to be exclusively brick and mortar in 2017? Or have these two retailers figured out a way to beat Amazon by not competing head-to-head with them at all?

Find out the answer to this and more on this week’s podcast.

Zacks' Top 10 Stocks for 2017

In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?

Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Amazon.com, Inc. (AMZN): Free Stock Analysis Report
TJX Companies, Inc. (The) (TJX): Free Stock Analysis Report
Tuesday Morning Corp. (TUES): Free Stock Analysis Report
Bed Bath & Beyond Inc. (BBBY): Free Stock Analysis Report
Ralph Lauren Corporation (RL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research