How to Invest in the Retail Innovators

  • (0: 20 ) – Retail Doom & Gloom: Where Is The Innovation?
  • (2: 35 ) – Leaders In Retail Innovation: RH
  • (11: 20 ) – TJX Companies: Homesense
  • (16: 15 ) – Walmart’s Multiple Acquisitions
  • (20: 45 ) – Nordstrom Local: Inventory Free Concept
  • (24: 30 ) – Ulta Beauty: Rewards Program Innovation
  • (29: 00 ) – Episode Roundup:

Welcome to Episode #100 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 Zacks Editor Maddy Johnson for the special 100 th episode of the podcast. Tracey and Maddy are back to discussing their favorite topic: retail.

But instead of talking about all the doom and gloom that Wall Street is obsessing about, they take a look at who is actually innovating in the space. What’s working for these companies as they try and disrupt the industry?

As an investor, these are the retailers you want to be in.

Buy those taking risks.

5 Innovating Retailers

1.      RH ( RH ) is making a big bet on brick and mortar as it continues to launch its massive gallery stores around the United States. On deck is an 80,000-square foot store in West Palm Beach Florida which will open in November 2017. They also include restaurants, which has turned into a nice side business for the company. The shares have been on a wild ride though. Should you be buying it?

2.      TJX Companies ( TJX ) doesn’t just operate TJ Maxx and Marshalls, it owns Homegoods, which is one of the best performing retail brands of the last 5 years. It recently launched an entirely new concept, Homesense, that will carry more furniture, including sofas. 

3.      Walmart ( WMT ) has been buying up high growth startups including Modcloth, Moose Jaw and now Bonobos which it bought for $310 million in June 2017. Can it turn these small, niche players into big business?

4.      Nordstrom ( JWN ) may or may not be going private. But in the meantime, it is launching Nordstrom Local which doesn’t carry inventory but will offer same day delivery. Are the inventory-free stores the next big retail thing?

5.      Ulta Beauty ( ULTA ) has created a rewards program juggernaut that is the best in the retail business. As of the end of July, it has 25.4 million members. How much more growth can there be? Can it keep its competitive advantage over companies like Amazon and Sephora?

What are the other challenges facing retailers who are looking outside the traditional brick and mortar/online model?

Tune into this week’s podcast to find out.

[In full disclosure, Tracey owns both RH and ULTA in her personal portfolio.]

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Nordstrom, Inc. (JWN): Free Stock Analysis Report

Wal-Mart Stores, Inc. (WMT): Free Stock Analysis Report

TJX Companies, Inc. (The) (TJX): Free Stock Analysis Report

Restoration Hardware Holdings Inc. (RH): Free Stock Analysis Report

Ulta Beauty Inc. (ULTA): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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