Strength Out Of Weakness
His thesis is quite simple really. With Linens N Things going out of business, Davidowitz thinks that Bed Bath & Beyond is well positioned.
“They’ve no debt and they should explode when the liquidation is over,” he says. In other words, he feels BBBY is so well run that with their biggest competitor out of the picture, they’ll perform even better.
And, he says the same is true of Kohl’s. Not only is rival Mervyns going out of business but with so much retail space now vacant he also expects their rent to go down.
Jeff Macke doesn’t quite agree. He says, “I don’t know why you would want to fight the trend, the tape or the weak consumer. The only trade is long Wal-Mart because they sell all the supplies you need for the coming hobo lifestyle.”
What's that they say? Oh yeah, different strokes for different folks.
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CNBC.com with wires