While the major averages posted lackluster results today, Cramer said there were big changes just under the surface, with Macy's (M) huge miss on earnings just the latest example of corporate turmoil. For many companies, the millennial generation might as well be aliens from a different planet. They're very different than their parents, and retailers especially, cannot adapt fast enough. Macy's execs admitted on their conference call that the chain continues to see shifting shopping trends that focus on value and experience, something Macy's struggles to offer. The company also admitted that America is "over-retailed" and it will take time for consolidation efforts to show results. These shifts should not come as a surprise to Mad Money viewers, as Cramer has chronicled the rise of the smart phone and how it turns brick-and-mortar stores into a negative. The stay-at-home economy continues to propel Amazon.com (AMZN) , Domino's Pizza (DPZ) and Electronic Arts (EA), but little else.
The Kids Are Taking Over the World: Cramer's 'Mad Money' Recap (Thursday 5/11/17) - TheStreet
Walmart is now using store employees to deliver packages to customers' homes in the retailer's latest effort to undercut Amazon. Here's how it works: store employees who opt into the program are given packages at the end of their work shifts, with a list of delivery addresses.
Walmart store employees now deliver packages to customer homes - Business Insider
Walmart (WMT) is back on the top of its game in the U.S., at least judging by two important retail metrics. "The last 12 quarters of positive same-store sales and 10 quarters of positive traffic are evidence that the U.S. bricks and mortar [business] has made significant progress in recapturing the lost [market] share," wrote Barclays analyst Karen Short on Monday. "While there is always room for improvement in any retail format, it is very clear the turnaround has taken hold, and more importantly Walmart is now taking a leadership role with respect to leveraging both e-commerce and bricks and mortar." Short has a $90.00 price target on Walmart, estimating at least another 12% move in the stock. It's hard to argue with Short's call on the world's larges retailer. Being viewed as the lowest priced for food continues to work wonders for Walmart in its battle against rivals Target (TGT) and Amazon (AMZN) .
Right Now Walmart Is Such a Force Again That Amazon Should Be Very Worried - TheStreet
Walmart's same-store sales at its U.S. stores rose 1.4% in the first quarter, spurred by a 1.5% increase in customer traffic. Getting people to visit physical stores is challenging for retailers right now as they are buying more of their stuff online. But, Walmart's year plus effort to slash prices in food -- which obviously needs to get bought weekly -- has it in a rare position of seeing people head to stores for food and other merchandise. Walmart U.S. chief Greg Foran at Walmart's 2017 annual meeting. Sales of food at U.S. stores increased by a low-single digit percentage in the first quarter, Walmart said, also helped by initiatives to keep items in-stock. Conceding that it continues to have a "perception" problem, where consumers don't see it as the lowest priced in food and other household essentials, Target notched another challenging quarter of sales. Target's first quarter same-store sales fell 1.3% as both traffic and the average amount spent by shoppers each fell. Sales of groceries declined as Target only began late in the quarter to market its new lower priced food and other weekly needs. Meanwhile under the leadership of Marc Lore, who came with Walmart's August 2016 acquisition of his e-commerce company Jet.com, Walmart saw its online sales spike 63% in the first quarter. On Thursday, Walmart announced that it started testing a new delivery method that uses employees to deliver online purchases to customers' homes. The move expands on the retailer's Pickup Discount, announced in April, which offers customers the option to get a discount on certain items they buy online if they pick it up at a local store. Customers can still take advantage of Walmart's free two-day shipping, of course.
Right Now Walmart Is Such a Force Again That Amazon Should Be Very Worried - TheStreet
Amazon.com (AMZN) said Thursday that its Amazon Lending service has surpassed $3 billion in loans to small businesses since it was launched in 2011. In the last 12 months alone the eCommerce giant has loaned over $1 billion to small businesses. Hiking up the sales for third party merchants is a plus for Amazon, as the company gets a piece of the transaction. "We created Amazon Lending to make it simple for up-and-coming small businesses to efficiently get a business loan, because we know that an infusion of capital at the right moment can put a small business on the path to even greater success," Amazon Marketplace VP Peeyush Nahar said. Over 20,000 small businesses have received a loan from Amazon and more than 50% of the businesses Amazon loans to end up taking a second loan.
Amazon Has Secretly Become a Giant Bank - TheStreet
Shark Tank star investor Daymond John turned $40 worth of fabric into a $6 billion urban clothing brand. Now the retail and branding guru has a solution for Macy's precipitous decline: Turn Macy's into a gamified destination. Legacy retail brands have been losing sales to the speed and convenience of e-commerce, a space being redefined by Amazon. "Macy's can become the Disney World of retail if they are just willing to change the game," said John, speaking with CNBC from the iCONIC conference in New York City on Wednesday. "First of all, they have one of the most iconic names in the world, and I think they are in one of the most iconic places in the world, and I think they can come up and be a Disneyland."
Shark Tank star Daymond John: Macy's can compete with Amazon
DiClemente wrote in a note to clients that four areas in particular could lead to big gains for Amazon: groceries, advertising, entertainment, and smart-speakers. The grocery business is one example of a market Amazon is ready to move into. The US food and beverage market represented a total of $705 billion in 2016 and e-commerce was a small 1.4% of that market, according to DiClemente. Amazon is beginning to address this market with programs like Prime Pantry and even a brick-and-motor store with no check-out clerks.
There are 4 new markets Amazon could be ready to take over (AMZN) | 06/15/17 | Markets Insider
Cramer also spoke with Joe Kiani, the chairman and CEO of medical device maker Masimo Corporation, on Friday to discuss his company and a recent reporting error that caused its stock to unjustly tank. After the Associated Press's automatic reporting mechanism incorrectly reported that the company had missed earnings and guidance estimates when it had not, Kiani said it set off a cycle that became increasingly worse as the news disseminated. "I guess, in this day of fake news, we should've expected something like that," Kiani said. "But unlike the normal fake news, this had even a greater impact because you have these robo-news agencies trying to use artificial intelligence to give information, but unfortunately, when they get it wrong, you have robo-computers selling or buying based on that news. So I think this had a terrible, vicious cycle." In reality, Masimo handily beat estimates, thanks in part to a nearly $5 million investment from the Bill and Melinda Gates Foundation to support its state-of-the-art pulse oximeters, which measure oxygen levels. "They looked at 20 pulse oximeters. They took the top three to five countries where a million children are, unfortunately, dying every year from pneumonia and tested it. Our error rate was less than 3 percent. The next-best pulse oximeter was over 30 percent. So I'm really happy to tell you we partnered with [the] Bill and Melinda Gates Foundation," Kiani told Cramer.
Cramer Remix: This retail stock could be immune to Amazon
Walmart (WMT) shares got crushed Friday following news that Amazon (AMZN) is aggressively moving into the grocery store business by scooping up Whole Foods. But while the online giant Amazon has been expanding its physical footprint, brick-and-mortar giant Walmart has been ramping up its own e-commerce business to compete. According to UBS analysts, Walmart.com’s stock keeping units (SKUs) have increased to around 50 million today from around 10 million a year ago. In fact, Walmart on Friday announced that it is buying Bonobos, a menswear brand built on the internet, for $310 million in cash. This is Walmart’s latest effort to expedite its digital transformation. Walmart has been selling online since 1999, and now is America’s third-largest e-commerce retailer, according to eMarketer. But Walmart’s online sales of $14.4 billion last year are still a far cry from Amazon’s $94.7 billion.
How Amazon is eclipsing Walmart's best efforts to dominate e-commerce
Amazon spread its reach further into the retail industry on Friday when it announced its jaw-dropping acquisition of Whole Foods for $13.7 billion. The market's instant reaction — Amazon's shares rallied while those of its competitors tumbled — sent a clear message: Investors are bullish on Amazon's success in the delicate business of fresh-food delivery, and they're worried about its effect on established grocers like Target and Walmart. But at least seven retail companies' stocks are "un-Amazon-able," according to a note on Monday from Oliver Chen, a senior equity research analyst at Cowen: "Taking a step back in the sector at large, we continue to believe investors will have more defense vs. AMZN's domination if they follow our Super Stock theory — we think deep value companies or luxury goods companies are more Un-Amazon-Able and less vulnerable to share losses vs. Amazon. "In our view, Un-Amazon-Able qualities include at Super-Value retailers Costco, Walmart, Ross Stores, TJX or extreme brand, store and vertical integration focus at Super-Premium luxury stocks (Tiffany, LVMH, Sotheby's)."
Amazon buys Whole Foods, but some companies are Amazon-proof - Business Insider
Jeff Bezos has hit the trifecta of megatrends now that Amazon has announced plans to add Whole Foods to its portfolio. Megatrend No. 1 is the digital transformation of our world, which Amazon was already leading. We’ve been told time and again how digitization is affecting all aspects of life, from retail purchasing to health care management. As Amazon knows, doing this well also creates a database that is itself huge, valuable and positioned for long-term commercial success. Megatrend No. 2 is the widespread recognition of the importance of healthy living and lifelong wellness, which Amazon now has in its grasp with the Whole Foods acquisition. Businesses from pharma to food have realized that healthy, active lifestyles are the key to prevention and wellness, and they are seeking opportunities to capitalize on it. For example, Nestlé recently announced that it may sell some of its candy business as it transforms into a health sciences behemoth. Amazon’s pivot toward the health and wellness space is one more signal that the business world is pursuing the commercial benefits of this area. Megatrend No. 3 is the biggest of all – the aging of society. Mr. Bezos now has this in his sights as a natural consequence of the first two megatrends. He may not even know it yet, but this is a place where real value can be created, but which others often don’t quite get. With a billion of us over 55 – and doubling in size over the next few decades -- aging will be the most important megatrend to drive huge revenue growth in the years to come. This is driven by fundamental demographic forces.
How Amazon could dominate 3 megatrends of the 21st century - Business Insider
Tuesday brought Amazon Prime Wardrobe, where the online retailer tackles the biggest problems of buying clothes: 1) the time it takes to shop, 2) the hassle of finding the size that's right for you, and 3) returning stuff you don't want. Judging by the market's reaction, it looks like the Street believes Amazon has advanced the ball considerably: Nordstrom closed down nearly 4 percent, JC Penney more than 5 percent, and Ascena Group and Chico's more than 4 percent. Even discounters like TJX and Ross Stores fell 3 percent and nearly 5 percent, respectively. It's a simple idea: try before you buy, and only pay for what you keep. Pick out three items or more, and you get shipping for free (if you're a Prime member of course). You have seven days to try the stuff on and decide what you keep.
Amazon strikes again: Nordstrom, JC Penney tank on 'Prime Wardrobe'
After its stock pop, Amazon got Whole Foods essentially for free. For free? Well, if you consider the increase in market capitalization that Amazon is seeing midday, the answer is yes. Here's the math: Amazon is paying $13.7 billion in cash for Whole Foods. Amazon's stock was up $32 and change mid-morning. There are 478 million shares outstanding, so Amazon's market cap has appreciated by about $15.6 billion today. So, you could argue, they are getting Whole Foods for free, and pocketing $1.9 billion as well.
After its stock pop, Amazon will get Whole Foods essentially for free
Stock pickers tend to screen companies for metrics including price-to-earnings ratios, analysts’ earnings estimates and profit margins. But there’s a simpler approach in this long period of technological transformation that is threatening industries from retail to banking: customer satisfaction. See: Every time this happens, Amazon crushes another legacy retailer The American Customer Satisfaction Core Alpha ETF ACSI, comprises about 170 mostly large-cap stocks that are selected according to American Customer Satisfaction Index scores. Stocks are allocated so that each sector is weighted within 10%, up or down, of that sector’s market-capitalization weighting in the benchmark S&P 500 Index SPX.
This fund strategist says there’s at least one way companies can survive Amazon’s onslaught - MarketWatch
Amazon has started a secret skunkworks lab dedicated to opportunities in health care, including new areas such as electronic medical records and telemedicine. Amazon has dubbed this stealth team 1492, which appears to be a reference to the year Columbus first landed in the Americas. The stealth team, which is headquartered in Seattle, is focused on both hardware and software projects, according to two people familiar. Amazon has become increasingly interested in exploring new business in healthcare. For example, Amazon has another unit exploring selling pharmaceuticals, CNBC reported in May.
Amazon 1492: secret health tech project
Before it was Amazon killing the retailers. Last week it was Amazon disrupting appliances. Now there's a broader concern: Amazon has the potential to disrupt the middleman in general, particularly those that work in the $7 trillion business-to-business (B2B) space.
Here's the issue: If you don't make the object you are selling, or don't have some sort of intellectual property, or solve a pain point for a customer, then you're just a middleman, and you are increasingly more vulnerable. The concern is that these middlemen will start losing volume because sales in general are going to the internet and because it's increasingly difficult to get pricing.
Amazon juggernaut sets its sights on its next victim: The middleman
But in 2015, Jeff Bezos' Seattle-headquartered tech giant decided it needed to do a better job of tapping into the online business-to-business (B2B) market, worth £96.5 billion ($125.4 billion) in the UK alone, according to the Office for National Statistics. It launched a new free-to-use business-supplies marketplace called Amazon Business in the US, expanding to Germany in December 2016 and the UK in April. Amazon Business is off to a promising start, according to Bill Burkland, the head of Amazon Business in the UK. "The US acquired over 400,000 businesses and a billion dollars in revenue for Amazon Business in its first year of business," he said during an interview at the company's London office, adding that there were 45,000 sellers on Amazon Business in the US by the end of the first year.
Amazon chases multibillion-dollar B2B business with Amazon Business - Business Insider
Bad news, Amazon investors: The company’s stock, already down 10% from its late-July high, is likely to decline even further. That’s because of the behavior of Wall Street analysts, whose earnings revisions tend to come in waves. And the vast majority of those revisions recently have been to the downside. This represents a big shift from the situation that prevailed as recently as 12 months ago. In August of last year, for example, 69% of Wall Street analysts who track Amazon AMZN, -0.75% revised upward their estimates of the company’s future earnings per share. Just 17% of analysts issued downward revisions that month.
The bad news on Amazon’s stock price is only beginning - MarketWatch
Names like Tiffany & Co. (TIF) , Dollar Tree Inc. (DLTR) and Signet Jewelers (SIG) are all higher on the day, although some have been volatile. Specifically, though, Cramer took a closer look at Michaels Cos. (MIK) , which is off the highs of the day, but still up 13% Thursday. Beyond just topping earnings and revenue estimates, retailers need to be a part of three key themes to get their stocks moving higher, Cramer said. Those themes include having a good omni-channel, providing consumers with an experience, and having a perception of value to customers. Those are the three themes needed to hold off Amazon.com Inc. (AMZN)
The 3 Secrets to Defeating Amazon, Revealed - TheStreet
Wal-Mart shoppers will soon be able to link their Wal-Mart accounts to Google Express and order items through Google's voice-enabled technology. In its partnership with Google, Wal-Mart will boast the largest number of items currently offered by a retailer through the Express platform. The deals will start rolling out in September, but Wal-Mart's Marc Lore promises, "This is just the beginning."
Wal-Mart partners with Google to offer voice shopping via Google Home
I think, in the wake of Amazon Prime, we are still trying to figure out what to do with this group of companies that has so many sellers in it. Perhaps, as Target's positive pre-announcement might be signaling, we have gotten too negative on the group? It's a great test of the moment. More important, though, whenever I see an en masse sector decline like this, I always like to step back and see what the decline is really saying. First, what it's not saying. Nobody is saying that these companies are going out of business. Their cash flows are still pretty good, their sales, while not electric, aren't falling off a cliff. Second, nobody is saying that, at least right now, their dividends are suspect. I do believe that their buybacks are probably going slower and their spend for e-commerce is going faster, with much of it not producing anything other than cannibalization of bricks and mortar.
Amazon Prime Is Wreaking Havoc on Retail, Jim Cramer Explains - TheStreet
We see three factors driving performance for retail stocks. First is mall exposure. We believe the U.S. is very overstored with almost 24 square feet of retail space per person. That compares to 16 in Canada and 11 in Australia. This means the U.S. has more than double every other country except Canada. We think companies are only in the early stages of rightsizing the store base and fear that companies with large store bases could see shrinking square footage over the next several years.
3 Factors Driving Retail Stocks' Decline
The European grocery chain Lidl has arrived in the US, and bargain hunters should be excited. A recent price check on a basket of 20 items by Jefferies analysts found that Lidl was about 9% cheaper than Walmart, the largest grocer in the US. Lidl claims to offer products for as much as 50% less than rival stores. So far, Lidl has opened 10 stores along the East Coast and plans to open 80 by the middle of next year.
How Lidl keeps its prices down - Business Insider
Amazon.com Inc.’s recent bid to acquire Whole Foods Market Inc. inflamed concerns in the U.S. about big tech companies taking over America. In China, that’s already happening. Alibaba Group Holding Ltd. and Tencent Holdings Ltd. are online-offline conglomerates each with hundreds of millions of users. The pair—directly or through companies they invest in—provides services and products across a range of businesses from retail, media and entertainment to health care, payment, banking, logistics and transportation.
To See What It Will Be Like When Amazon Owns Everything, Look at China - WSJ