Stock Pick

  • U.S. Tightens Rules to Crack Down on Huawei’s Chip Supply

    U.S. Tightens Rules to Crack Down on Huawei’s Chip SupplyMay.17 — The Trump administration moved to prevent chipmakers using U.S. technology from supplying Huawei Technologies Co. Tom Mackenzie reports on “Bloomberg Daybreak: Australia.”

    from Yahoo Finance https://ift.tt/3dMNJJE

  • Apple To Reopen 25 U.S. Stores This Week, Adding to 100 Others

    Apple To Reopen 25 U.S. Stores This Week, Adding to 100 Others(Bloomberg) — Apple Inc. said it’s reopening more than 25 stores across seven U.S. states this week, adding to nearly 100 global locations that have reopened to customers after the Covid-19 pandemic forced them to close. Some stores will offer only curbside or storefront service, the company added in an email statement.In a letter to customers by Deirdre O’Brien, Apple’s senior vice president for retail and people, the company said it’s “focused on limiting occupancy and giving everybody lots of room,” with a renewed emphasis on one-to-one service throughout each store. There’ll be temperature checks conducted at the door and face coverings will be required for all employees and provided to any shoppers without one.“A store opening in no way means that we won’t take the preventative step of closing it again should local conditions warrant,” O’Brien wrote.The Cupertino, California-based tech giant is in the process of reopening most of its retail sales network across Italy, Germany, Austria, Switzerland and Australia. It plans to reopen 10 of its 17 stores in Italy this week, it said on Friday.Read more: Apple to Reopen 10 of 17 Retail Stores in Italy Next WeekApple closed all of its stores in mainland China early on in the novel coronavirus outbreak, which it was able to reopen a few weeks later as the pandemic was reined in across the country. It then closed all of its stores outside greater China until it started a gradual reopening with its Seoul, South Korea location recently.(Updates with U.S. store reopening plans in first paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    from Yahoo Finance https://ift.tt/2TcZwZG

  • How this $70m ASX small cap is cutting down a $50bn industry

    ASX Small Caps

    The online sales surge reported by Shaver Shop Group Ltd (ASX: SSG) last week is an ominous sign for the $50 billion shopping mall industry.

    The $70 million market cap retailer reported last Thursday a near 400% surge in online sales for the six weeks to May 10 as Aussies rediscovered the love of self-grooming during this COVID-19 lockdown.

    This has the potential to re-write the lopsided relationship between small retailers and all-powerful shopping centre landlords sooner than many think.

    Six years in six weeks

    Shaver Shop isn’t the only retailer to see a big online surge. Others like Myer Holdings Ltd (ASX: MYR), Premier Investments Limited (ASX: PMV) and JB Hi-Fi Limited (ASX: JBH) have reported strong growth in internet sales.

    While the online trend isn’t new, the surge in adoption rates due to the coronavirus pandemic over the six-week shutdown is probably equal to what is forecast for the next six years!

    Power rebalances

    This changes the power balance between ASX retailers and property groups in two ways. The first is the realisation by retailers that they don’t need as many shops as they thought previously.

    The second is the devaluation of foot traffic. In the past, mall operators would incentivise large anchor tenants, such as Woolworths Group Ltd (ASX: WOW), to move in as they draw large number of shoppers.

    This allows landlords to charge a premium to smaller retailers who regard high traffic areas as a key sales driver. Smaller retailers are usually charged a base rent plus a variable component on sales turnover.

    Mega malls have peaked

    But the business model for landlords may have to change and it’s the mega malls that are likely to feel more of the impact of this structural shift.

    The losers include Vicinity Centres (ASX: VCX) with its flagship Chadstone Shopping Centre, and Scentre Group (ASX: SCG) with its Westfield branded shopping destinations.

    If physical stores become pick-up points for online orders or a showcase for products to aid web purchases, then retailers will baulk at paying a premium to be in mega malls.

    Foolish takeaway

    Don’t get me wrong, I am not saying mega malls will turn into ghost cities in the post COVID-19 apocalypse. But their strategic value has probably peaked and these landlords have a lot of shops to fill.

    What this means for investors in ASX-listed Australian real estate investment trusts (A-REITs) is that they may need to question traditional valuation models when making their investment decision.

    On the flipside, the online evolution is likely to lift the operating margins for ASX retailers. This means that profitability can improve even if online sales don’t fully offset lost sales from a physical store.

    The David and Goliath battle is only just beginning.

    5 “Bounce Back” Stocks To Tame The Bear Market (FREE REPORT)

    Master investor Scott Phillips has sifted through the wreckage and identified the 5 stocks he thinks could bounce back the hardest once the coronavirus is contained.

    Given how far some of them have fallen, the upside potential could be enormous.

    The report is called 5 Stocks For Building Wealth after 50, and you can grab a copy for FREE for a limited time only.

    But you will have to hurry — history has shown the market could bounce significantly higher before the virus is contained, meaning the cheap prices on offer today might not last for long.

    See the 5 stocks

     

    More reading

    Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. Connect with him on Twitter @brenlau.

    The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. The Motley Fool Australia owns shares of Woolworths Limited. The Motley Fool Australia has recommended Scentre Group. 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. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post How this $70m ASX small cap is cutting down a $50bn industry appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2AxA3nm

The Latest