Retail Sector Up 18% but profits expected to be thin

That was the word mummering from the cash registers at most retail stores. I think its a shorting season on Retail. If the consumer is going to blindly keep spending when everyone and their mother sees a recession coming then we may be in for a long recession...

When Black Friday Comes

I woke up this morning thinking, "When does the retail market take responsibility for the slumping sales they are sure to incur?"

My thought is that there is no IT gadget or product this year. You discount a piece of coal to $.01 but nobody wants a lump of coal for Christmas!

I am not bitter because I only made a few pennies instead of the large profit I could have made if I cover it one day earlier, I am placing the buck where needs to placed. Stop whining retail sector and invest in some innovation.

DDS out @ 18.10 Covered My Shorts :(

Lots of stress for 2%. Okay well 2% over two or three trading days isn't bad. I could have done a lot better IF I would ahve stayed in the stock a lot shorter (yes shorter than two days - one day - should have taken it at 16.50 or 17) and I should not be so optimistic when covering a short by placing an unrealistic limit price on it.

I need a latte, I need to make better profits than a stinking 2%. I need the success of PBR or NOV.

Like I said I am considering going long on this stock now that I have seen it test this low so effectively.

Takeover, Sleepover - more On Dillard Department Stores - DDS

Lets not get crazy here people but DDS is up around 17.94 with some positive ticks. If this thing get to $18.00 I have to get out! I would have to abandon my strategy of waiting until next week. That would be a bummer. I know this stock is goign to fall around 15-14. I just intuitively feel its got to test that bottom out.

Please understand that I will more than likely convert this stock to a long term position and through it in my IRA once I cover my short position. I am under the impression that this stock has been beat to hell. And I like their real estate holdings and think the market will come back one day.

But hey for the Some interesting news came out, but as news goes it could just be some smoke and mirrors. There is some articles that talked about how the top executives had worked out a golden parachute plan (read this thread for a better take on things)

Shorted Dillard Deparment Stores, Inc. on 11/20/2007

Wow, the market being open today is like being caught smoking in the boys room. It's like someone scaring you when you come around the corner, yikes! I mean really the market should be closed today, like most business!

Well anyways I forgot to mention that I shorted DDS last week. It is the third move I made in November and I wanted to get it documented.

DDS - Dillard Department Stores, Inc.

If you go in the store its horribly empty. I also know that with most retail companies you have to take into account the real estate that they own (click here to read a great message thread on this), and Dillards owns a lot. But I just can't shake that whenever I walk into the stores it looks like the sales people are trying so hard not to act desperate that its comical.

I saw that they were up 30% one day early last week on some really bogus news. The company had reported 3 quarter problems but yet the stock was surging.

Then I saw another release come out and the light bulb went off. Dillards was issuing a stock buy back program and they had an upgrade from some analyst that obviously would support the idea that Dillards was not valuable because they are a retail company but because they are a large holder of real estate.

Well sometimes the market doesn't respond to reason. Sometimes it goes off common sense or lets call it emotional sense. People think Dillards, they see the news talking about Black Friday and how the retail sector is going to Haites, they hear that the Federal reserve chairman is saying that it is more than likely that we are going into a recession, and they start to get emotional about these topics. They start to think to themselves that it would be stupid to gout and spend money on lavish gifts because they were watching the today show and Ann Curry said most Americans are tightening their purse strings this year, I should too. Some of those people are investors ...

Hey I am with the stock gurus who say Dillards is a great stock because of the real estate they own and the stock should be at $50 a share. Listen I though Webvan was a great idea, did that mean that the company should be rewarded by the market? Well let me tell you having groceries delivered to my door step in 1999 was awesome. I am glad a associate of mine has brought it back in 2005. The poor stockholders and employees of Webvan should have had seen growth that reflected its pioneering ideas. Instead it was picked apart in by Analyst. Well now its the revenge of emotional sense.

So I shorted DDS on 11/20 at 18.40

I could have and should have jumped out at 16.57 the next day 11/21. I would have kept my margin interest down and I would have saved myself some extra grey hairs. But something told me to wait until after Black Friday when some of the stores start to report what I saw. That the shoppers were going into the stores and buying the drastically reduced - get you in the store sale items. They were only buying those items... The idea is to get you to buy other items too.

Also there were not a lot of people at the malls. I watched the news reports and they were reporting half full parking lots. Not a good sign.

Well we will see. I want out of this stock next week. It's up today 2.7% but I am still in the positive gains so I can hold my breath until Monday... I hope...

p.s. read this article on DDS and how it missed its 3Q profits its a good one.