Nomura Securities on Retail Company 10-Ks: Interesting Takeaways from Hardlines

April 5, 2012 11:30 AM EDT Send to a Friend
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Nomura Securities on Retail Company 10-Ks: Interesting Takeaways from Hardlines

Analyst, Paul Lejuez, said, "After scouring through recently filed 10K’s, we found several interesting takeaways – not necessarily market-moving details but rather things that struck a chord and made us think.

Tractor Supply Co. (Nasdaq: TSCO): Continuing to increase the average number of unique products/store. Also promotes newness by changing out 1/3 of its SKUs annually.

PetSmart (Nasdaq: PETM): Extended the measurement period for performance-based comp. The new program incentivizes even better decision-making, in our view.

Lowe's (NYSE: LOW): Total advertising spend is higher than HD, despite being a much smaller company. The opportunity, if normalized, is about 50 bps.

OfficeMax (NYSE: OMX): Funded status of the pension plan continues to deteriorate. This is a significant drag on projected equity values (-30% vs. -15% last year).

Staples (Nasdaq: SPLS): Driving private-brand growth through services. This could prove to be ‘stickier’ with the consumer than straight product penetration.

Advanced Auto (NYSE: AAP): Backing off its smallest store prototype (6k) in order to facilitate commercial growth.


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