2-Star Stocks Poised to Plunge: RadioShack?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, embattled electronics retailer RadioShack (NYS: RSH) has received a distressing two-star ranking.
With that in mind, let's take a closer look at RadioShack's business and see what CAPS investors are saying about the stock right now.
RadioShackfacts
Headquarters (founded) | Fort Worth, Texas (1899) |
Market Cap | $480.2 million |
Industry | Computer and electronics retail |
Trailing-12-Month Revenue | $4.4 billion |
Management | CEO James Gooch (since 2011) |
Return on Equity (average, past 3 years) | 13.9% |
Cash/Debt | $566.4 million / $674.9 million |
Dividend Yield | 10.5% |
Competitors | Amazon.com |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 44% of the 868 members who have rated RadioShack believe the stock will underperform the S&P 500 going forward.
Earlier this month, one of those Fools, troym72, succinctly summed up the bear case for our community:
Their margins and revenues are declining almost every quarter. They are being pushed out of the market by larger players in electronics. ... [A]nything you can get at RadioShack, you can get at Amazon or NewEgg without ever leaving your house. And if you want a mobile phone, RadioShack has to compete with Best Buy, Wal-Mart and direct carrier stores for that business too. I just don't think RadioShack is relevant in retail anymore.
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At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of RadioShack, Best Buy, and Amazon.com. Motley Fool newsletter services have recommended buying shares of Amazon.com. Motley Fool newsletter services have recommended creating a diagonal call position in Wal-Mart Stores. The Motley Fool has a disclosure policy.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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