Big box wholesalers Costco and BJ’s reported earnings in-line or above estimates but Jeff Macke is still wary of the larger retail space.
BJ’s is a quintessential “sell the rips, buy the dips” stock, according to Macke. Costco, on the other hand, is one of only three retail stocks he sanctioned to own for the long haul. The other two are Wal-Mart , which he said is now “priced to move,” and Gap , a name so beaten down over the last few years that he’s picking it purely as a play on hope.
Macke won’t go near much else in retail because it has proven, time and time again, that it’s too hard to game. Just look at Saks . The upscale merchant recently announced better-than-expected February sales but the stock got pummeled anyway. If that doesn’t prove that this economy is not on the side of the retail sector, Macke doesn’t know what does.
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