Any investors out there...

[gotmilk]

Here's one for you guys thinking Kmart is still a good purchase....Mark Schwartz was booted because he was cooking the books..and paperwork is missing.

The SEC is reviewing and auditing Kmart's financials in the same manner they are investigating Enron.

Schwartz did this on purpose...he is buddy-buddy with WalMart and killing Kmart will give Walmart free access to Martha. She will have no choice but to leave when this story develops further.

Next?

 

[bondgirl2217]

kmart is now cooperating with the SEC , like enron.. because of questionable accounting practices. so we will see what happens

 

[njmuscle]

Main problem with KMart is that they don't have a clear identity - WalMart beats them on price almost every time because of their greater distribution efficiency, and Target appeals to a different customer demographic (they used to describe themselves as "your upscale discount store.") Target and WalMart can happily coexist, but KM can't defeat either of them. What's KMart doing to do to give themselves a clear identity? There might be a window of opportunity to emphasize the Super-K grocery/discount store combos, but grocery is a ruthless business.

If I was going to do a trade on the KM situation (having already missed the chance to buy Target before the bankruptcy), I'd short Martha Stewart - I don't think WalMart will want the line, and Target already has name-brand linens and the Michael Graves line of kitchen stuff.

As for airlines, I already own some, but I wouldn't touch UAL with a ten-foot pole, except on a VERY short-term basis - too many labour issues, including a mechanics union that lives in an alternate reality. I have some sympathy for them (they are way beind mechanics at some of the other majors), but there's no way the airline can meet their demands. I don't even think the airline can afford the mediator's recommendation, which UAL management has said they would accept. They've already had a PEB on this one - it could come down to a strike, and I wouldn't be surprised if travel agents are already booking away from UAL. I think UAL will survive (unlike US, which is in a race with America West to see who'll tank first), but there could be a Chapter 11 in their future.

With airlines, unless you're strictly a short-term trader, good management is the key - CEOs like Herb Kelleher (Southwest), Gordon Bethune (Continental), or David Neeleman (JetBlue - I can't wait for the IPO!) In the last decade, UAL has consistently been one of the worst managed companies of its size in any industry. The new CEO may be able turn this around, but there are so many issues - high costs, labour strife, loss of full-fare coach passengers to AA, etc. - that there are better investment opportunities elsewhere.

 

[Longhorn85]

keeping the debate alive...

News on the Kmart front. They seem to be surviving. The stock dipped below 1$ but rebounded and has remained on the NYSE.

They are trimming fat right and left, and have you noticed their aggressive new ad campaign?

Might want to buy some now, while it's cheap.

 

[Longhorn85]

A link describing some of Kmart's initiatives:

http://dailynews.yahoo.com/h/nm/20020308/bs/retail_kmart_stores_dc_2.html

 

[VicTusDeuS]

If the issue new stock to their creditors the current stock can be worthless. They filed for bankruptcy, they cano do this. The economy has signs of comming back. When the economy is strong and consumer confidence goes up people return to buying at neiman marcus and saks...

 

[Longhorn85]

We will see. When the water rises, everything in it should float up, right? Unless it has a leak.

 

[VicTusDeuS]

no there is something they can do to re issue new stock that is totally different than the stock that is out there-so there is a possibility to loose your money. They are in banruptcy now, they can always come out of it but they mke come out in the form of a new company. I dont think K mart will ever be able to grow to the size it is now. WAL-Mart outsells them and has similiar prices. In most of the low sales stores walmarts are not too far away...

 

[Longhorn85]

Ok, I have finally put my money where my mouth is. Bought a few KM shares Monday (300) at 1.30. Today it is listed at about 1.60. Hopefully it will get at least back up to the 3.50-4.00 range by the end of the year. Not a bad piece of change for little work and little risk.

 

[gotmilk]

booting Conaway was a great step....too bad Schwartz sabotaged the company.

By the way, Schwartz's father-in-law owns massive amounts of Fleming stock...Fleming wanted KM dirt cheap....Schwartz works for who now?

That's right....Fleming.