Why RadioShack Has Crashed in 2012

Today, Austin discusses RadioShack's (NYS: RSH) enormous 60% crash thus far this year. Unfortunately for the electronic goods retailer, this could be a long-term problem. In addition to competing in a slowly deteriorating sector, RadioShack recently entered the mobile market. This move will force the company to slash margins, and it does not have the top-line growth to compensate for those losses. Most of all, though, it simply cannot produce a winning model. Companies like Amazon snatch revenue from traditionally profitable areas such as headphones, and razor-thin margins will sink the company. Austin thinks the slide reflects the direction of the company.

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The article Why RadioShack Has Crashed in 2012 originally appeared on Fool.com.

Austin Smith has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Best Buy, and RadioShack. Motley Fool newsletter services recommend Apple. 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.

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