Four of the five worst-performing S&P 500 stocks in the first half of the year were department stores. A few days into the second half of 2019, there is no indication that trend is changing.
Nordstrom, which finished June with the dubious distinction of the S&P 500’s worst performer, lost 2.3% Tuesday after UBS became the latest in a string of firms to lower its rating for the stock.
The selling pressure spilled over more broadly in the retail sector: Macy’s and Kohl’s were also among the five biggest S&P 500 decliners in the first half of the year, fell 1.3% and 1.1% respectively. Gap Inc.. fills out the roster. And, JCPenney is down 55% for the 12 month period.
The disruption is not about retail in general: Walmart, Target, Costco, Marshall’s, Ross Stores, Home Depot, Lowes and others are showing growth in sales and earnings.
And then there is Amazon…
The business model for department stores has been disrupted. And, disruption is the mother of invention. Stay tuned…