Re: [CANSLIM] KMart vs Enron

From: "Katherine Malm" <kmalm@earthlink.net>
Subject: Re: [CANSLIM] KMart vs Enron
Date: Tue, 22 Jan 2002 10:51:59 -0600
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I see a biggest difference in the ENE vs KM story as a lesson in =
capitalism. That is, when a business becomes redundant or has lost its =
strategic advantage, it disappears. I'm sorry for the KM shareholders, =
but KM's inability to buck up and smell the market before it was too =
late has put it where it is today. WMT redefined discount retailing, TGT =
created a targeted demographic twist, NDN and DG segmented and =
subdivided the "big store" into small local stores reminiscent of the =
old 5 and dime, BBBY and LIN created a unique niche, etc. I'd go to KM =
to buy Martha Stewart goodies, but I don't even know where there's a =
store in town! Bad locations, bad strategies, bad execution, didn't "own =
up" to the problem until it was many years too late. Bye-bye KM.

Katherine
  ----- Original Message -----=20
  From: Tom Worley=20
  To: canslim@lists.xmission.com=20
  Sent: Tuesday, January 22, 2002 10:27 AM
  Subject: [CANSLIM] KMart vs Enron


  Today's bankruptcy filing by KMart opens a lot of questions, starting =
with which will be the bigger story, KM or ENE?

  Both are huge bankruptcies, ENE likely to remain the biggest, but KM =
is the largest by a retailer. And with over 2,100 brick and mortar =
stores, many of which will likely be closed, going to have a significant =
impact on employment.

  ENE died because of financial shenanigans and corrupt insider deals, =
lots of lies and plenty of places to put the blame, including on the =
auditors.

  KM will likely survive, but take a year or more, and emerge as much =
smaller and less competitive. Since it already proved it cannot stand =
against Walmart and Target, questionable in my mind what it can do =
differently as a smaller retail chain. Was this only stiff competition =
in a recession, or poor management as well?

  With KM down 54% just for today, and 94% since its last high on =
8/8/01, who can you trust anymore in the executive level of =
corporations. Today makes me glad I stick to my small caps, where a =
rumored buyout finally official gave me a 10% gain on one stock, and a =
new contract gave me 13% on another. Big caps are just too big and =
complicated for the likes of me. At least I make money for the day.

  Tom Worley
  stkguru@netside.net
  AIM: TexWorley

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<DIV>I see a biggest difference in the ENE vs KM story as a lesson in=20
capitalism. That is, when a business becomes redundant or has lost its =
strategic=20
advantage, it disappears. I'm sorry for the KM shareholders, but KM's =
inability=20
to buck up and smell the market before it was too late has put it where =
it is=20
today. WMT redefined discount retailing, TGT created a targeted =
demographic=20
twist, NDN and DG segmented and subdivided the "big store" into small =
local=20
stores reminiscent of the old 5 and dime, BBBY and LIN created a unique =
niche,=20
etc. I'd go to KM to buy Martha Stewart goodies, but I don't even know =
where=20
there's a store in town! Bad locations, bad strategies, bad execution, =
didn't=20
"own up" to the problem until it was many years too late. Bye-bye =
KM.</DIV>
<DIV>&nbsp;</DIV>
<DIV>Katherine</DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
  <DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
  <DIV=20
  style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
  <A title=3Dstkguru@netside.net href=3D"mailto:stkguru@netside.net">Tom =
Worley</A>=20
  </DIV>
  <DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
  =
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
 </DIV>
  <DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Tuesday, January 22, 2002 =
10:27=20
  AM</DIV>
  <DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] KMart vs =
Enron</DIV>
  <DIV><BR></DIV>
  <DIV><FONT face=3DArial>Today's bankruptcy filing by KMart opens a lot =
of=20
  questions, starting with which will be the bigger story, KM or=20
  ENE?</FONT></DIV>
  <DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
  <DIV><FONT face=3DArial>Both are huge bankruptcies, ENE likely to =
remain the=20
  biggest, but KM is the largest by a retailer. And with over 2,100 =
brick and=20
  mortar stores, many of which will likely be closed, going to have a=20
  significant impact on employment.</FONT></DIV>
  <DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
  <DIV><FONT face=3DArial>ENE died because of financial shenanigans and =
corrupt=20
  insider deals, lots of lies and plenty of places to put the blame, =
including=20
  on the auditors.</FONT></DIV>
  <DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
  <DIV><FONT face=3DArial>KM will likely survive, but take a year or =
more, and=20
  emerge as much smaller and less competitive. Since it already proved =
it cannot=20
  stand against Walmart and Target, questionable in my mind what it can =
do=20
  differently as a smaller retail chain. Was this only stiff competition =
in a=20
  recession, or poor management as well?</FONT></DIV>
  <DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
  <DIV><FONT face=3DArial>With KM down 54% just for today, and 94% since =
its last=20
  high on 8/8/01, who can you trust anymore in the executive level of=20
  corporations. Today makes me glad I stick to my small caps, where a =
rumored=20
  buyout finally official gave me a 10% gain on one stock, and a new =
contract=20
  gave me 13% on another. Big caps are just too big and complicated for =
the=20
  likes of me. At least I make money for the day.</FONT></DIV>
  <DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
  <DIV><FONT face=3DArial>Tom Worley<BR><A=20
  href=3D"mailto:stkguru@netside.net">stkguru@netside.net</A><BR>AIM:=20
  TexWorley</FONT></DIV></BLOCKQUOTE></BODY></HTML>

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