There is a lot of money going into home real estate, and home improvement runs in step with that.
I think it's going to be very, very good. The question is, is it very, very good, or is it hey, this is just super-great hall-of-fame good?
We think that investor speculation on a potential take-over of the company could keep shares in the mid-$20s range.
Best Buy is the best of breed in the consumer electronics space right now. Circuit City's problems are worsening. It's really a questionable move for the company to get rid of some of its best sales people when its sales are eroding.
What happens is anything that becomes too 'in' eventually becomes sort of 'out,' so you have Gap as a very stale, mature concept.
In my judgment a bankruptcy certainly is not precluded from being an ultimate scenario. However, I don't see it on the more immediate horizon. If you are a company of this magnitude ... to a certain degree the banks feel it is in their interest give you more rope and keep you going in the hope and expectation that you'll turn it around. I think that's probably what's going to happen here.
They just went completely bonkers on the expansion.
It's too early to figure out the impact, but generally, if you're losing market share, reducing customer service does very little to stem that loss.
While Circuit City has embarked on a program to modernize and hopefully improve in-store execution, the feeling is they continue to lose market share and fall behind the competition.
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