I'm working in retail as a part-time worker. One of the good things about this job is, they offer retirement and a stock option for people who want to participate. I decided to do stock, just because they both are actually "investments" in stock market, but I figured the stock plan has a better return and more freedom to manage.
Well, so I regularly check the company's stock price, my stocks, and recent news about the company.
I run into an article speculating my employer, Ross could buy a high-end department store chain, Macy's.
I checked Macy's stock, and it practically nose dived since the end of Nov. 2016. If Ross wants to buy it, seems like the time is right. Also, the acquistion will create diversity in their business strategies, and it might create more opportunities for more revenue.
However, my employer Ross, and Macy's have two very different business models. Ross is a off-price, discount retail. Macy's is a high-end retail. If Ross's top officers are predicting the economic growth and are thinking that people will start going back to department stores, it might be a good idea.
I personally think that once people discovered $100 jeans at high-end store is sold for $30 at discount stores, they will keep going back to the discount stores. Why not?
Ross might be looking into Macy's off-price stores they recently started. Ross is an expert of off-price retail, and Ross has been very successful at it.
Macy's could be downsized even more, and renew as the department stores only cater top few % and ultra high-end store with superb customer services you don't get from anywhere else. Macy's itself could become a "brand" or status store, sort of like Nordstrom that lower 50 % can only dream about.
I don't think it's such a great idea for Ross to acquire Macy's. It might not be too hard to predict the economy, just because it follows a pattern. But it could be hard to predict how people react to it, consumer confidence level, and their purchasing power, especially when the socio-economic inequality is expected to be bigger. After all, high-end retail is the polar opposit from Ross's business strategy. It will be a big gamble.
Well, anything in life is a gamble. YOLO
It's only a speculation, and so far, a few Ross stocks I own are doing fine.