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    A Decade of Revolution Declare Your Research Independence

Takeaway: Fast Retailing buying JCrew? GPS? Fake SHLD data breach. MW/JOSB finally dating. WMT makes it easier for people to not go in their stores.


  • RSH - Earnings Call: Tuesday 3/4, 10:00am
  • WMT - Raymond James Conference: Tuesday, 3/4 10:25am


9983, Jcrew - J. Crew in Talks to be Sold to Japan's Fast Retailing


  • "The owners of J. Crew Group Inc. are in talks to sell the clothing retailer to Japan's Fast Retailing Co. for as much as $5 billion, a deal that would help the Asian company fulfill its ambition of becoming a global retailing powerhouse."
  • "Fast Retailing, which owns the Uniqlo apparel chain, approached J. Crew's management about potentially buying the private-equity-owned business, said people familiar with the matter. J. Crew is seeking upward of $5 billion for the business, one of the people said. It remained unclear whether Fast Retailing would pay that much and whether the two sides have yet discussed a price."

Takeaway: Fast Retailing has long been on the lookout for major US mall assets. One of the key players consistently in the running has been GPS. While that didn't sit too well with us, the reality is that others believed it. Fast Retailing is one of the few companies out there with a) the desire to own something as big as GPS, and b) the access to capital to get it done. Looks like that one is off the table for now (and for a very long time).  

SHLD - Sears Holdings Statement


  • "There have been rumors and reports throughout the retail industry of security incidents at various retailers, and we are actively reviewing our systems to determine if we have been a victim of a breach.   We have found no information based on our review of our systems to date indicating a breach."

Takeaway: Sears is so easy to pick on, but that doesn’t make it right to fabricate rumors about data security and integrity.

WMT - Sam's Club tests online subscription service


  • "Sam's Club is testing a new online service called 'My Subscriptions' which allows shoppers to have repeat-purchase items delivered to their homes automatically. The goal of the program is to save customers time by renewing their stash of household and personal care items on an ongoing cycle."

Takeaway: This is a tough one. On one hand, we see why Sam's is doing this, and it makes sense -- minimize the time between purchases of essential items. But on the flip side, the comp at warehouse clubs is driven not just by regular purchases of consumer staples, but by all the discretionary items that consumers buy that they didn't otherwise plan to buy -- simply because they see something interesting at a good price on the shelves. Simply put, they've got to get people in the stores. We were similarly perplexed when Wal-Mart started beta-testing its 'curbside pickup' program, where people order online and pickup at the front of the store. Again, WMT needs to boost traffic and therefore discretionary purchases. 

MW, JOSB - Men's Wearhouse Announces Non-Disclosure Agreement With Jos. A. Bank


  • "The Men's Wearhouse today confirmed that it entered into a non-disclosure agreement with Jos. A. Bank Clothiers on Saturday night, March 1, 2014, under which the companies have agreed to exchange certain confidential information and to work in good faith to evaluate a potential combination, and that Men's Wearhouse has received a draft merger agreement from Jos. A. Bank."
  • "Men's Wearhouse noted that its existing cash tender offer for $63.50 would provide Jos. A. Bank shareholders with a substantial premium and immediate value, and that as previously announced, Men's Wearhouse is prepared to increase its offer price to $65 per share if Jos. A. Bank can demonstrate or Men's Wearhouse can discover additional value through discussions or limited due diligence."

Takeaway: These two are finally sitting down to work out their marital problems. This thing has been such a circus side-show that our expectations are extraordinarily low for a resolution. But if we had to predict an the outcome with the greatest probability, we'd say MW takes out JOSB for $65.  If all else fails, JOSB loses a third of its market cap.


DKS - Modell’s CEO impersonated Dick’s exec in spy scheme: suit


  • "The CEO of the Big Apple-based Modell’s chain has been sued by big-box rival Dick’s Sporting Goods, which charges that Modell impersonated a Dick’s exec earlier this month as he spied on a store in Princeton, NJ."
  • "Modell...claimed to be a Dick’s senior vice president as he persuaded employees to give him access to the backroom of the store and grilled them about the business, the suit alleges."
  • "Modell told store workers he was scheduled to meet with Dick’s CEO Ed Stack at the store, and appeared to be particularly interested in a 'ship from store' program that delivers goods to customers’ homes from nearby locations, the suit said."

Takeaway: #funny

HD - Home Depot’s New President Said to Be Groomed as CEO


  • "Home Depot Inc.’s promotion of Craig Menear to president of its U.S. retail division is part of a succession plan for Chief Executive Officer Frank Blake, according to a person with knowledge of the situation."
  • "Menear, 56, is the leading candidate to become the next CEO of the largest U.S. home-improvement chain, said the person, who asked not to be named because the talks are private. There isn’t a timeline for the succession, the person said. Menear joined Home Depot in 1997 and served as executive vice president of merchandising before his promotion, the Atlanta-based company said yesterday in a statement."