The following video is part of our "Motley Fool Conversations" series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.
The American shopper might be looking for bargains again. June same-store sales numbers came in below analyst expectations. And it looks like customers are becoming more and more cost-conscious. High-end retailers like Nordstrom and Limited Brands did put up big numbers in June, however, providing evidence that the high-end consumer is still spending. And discount retailers TJX Companies also turned in some strong gains. But when we get to retailers that serve the middle-class shopper, such as Target, the numbers came in a little bit low, suggesting those consumers are starting to pull back a bit. If David could only own one retailer, it would be Costco. Its customers average about $85,000 of household income. Its membership approach is a very strong business model, and it has a tremendous management team. This stock is worth buying on the dips.
Retail is in its largest period of transition ever. The companies left behind will bankrupt investors, while the few exceptional leaders benefiting from this change will see astounding growth in the years ahead. The Motley Fool has created a free report, "The Death of Retail," that highlights two companies, hand-picked by Fool analysts, that are set to dominate the future. To check out these two companies and learn more about the future of retailing, click here now -- it's free!
At the time thisarticle was published David Meierhas no positions in the stocks mentioned above. John Reeves owns shares of Costco Wholesale. The Motley Fool owns shares of Costco Wholesale. Motley Fool newsletter services recommend Costco Wholesale. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.