Is there anything to like about life on planet retail right now? In the last few weeks I've looked at the supermarkets and M&S. But what about the rest? Are there any rays of light in the grey gloom that hangs over Britain's high streets?
They are not easy to find. The fact of the consumer squeeze is well known and almost every trading statement you'd care to mention in recent weeks talks about how "challenging" conditions are.
The much-feared "double-dip" recession looks like it has arrived with most forecasters saying that this country is now "technically" in one with the economy expected to show a second-consecutive quarter of shrinkage when the Office for National Statistics unveils the numbers for the first three months of 2012 in April.
Unemployment is still rising, confidence is falling, from pretty low levels too. Margins are going to be under pressure because if stores don't keep their prices low, they won't see any of their customers' money.
Is there any light at the end of the tunnel? Well perhaps. One plus point in retailers' favour is that it finally looks as if inflation is falling. It might be a year later than the Bank of England originally thought, but the downhill slopes have been reached. And there are forecasters who think it will come down faster than the official predictions would have you believe.
Shops' input costs are falling. The price of their raw materials, and the products they sell, appear to be easing. Which should make it easier for them to keep prices low while at least maintaining some sort of margin.
The Independent featured two retailers in our 10 to follow at the beginning of the year – JD Sports Fashion and Burberry.
We said buy the former at 624p, attracted by its ridiculously low valuation and the boost it might enjoy from a year with two major sporting events – the Olympics and the European Football Championships.
It seems someone was listening. The shares subsequently smashed through the 700p barrier and carried on gaining. They are now up nearly 20 per cent. But even at that price, they remain a bargain trading on just 6.7 times forecast earnings, with a respectable prospective yield of 3.5 per cent. At that price JD is still a buy.
Burberry's shares have broken through 1400p and also carried on. They are showing a similar percentage gain from when they were tipped at 1185p.
They now enjoy a barnstorming rating of 22.7 times forecast earnings, yielding just 1.8 per cent. That is largely because Burberry is now an international luxury brand with exposure to places that, unlike Britain, are growing, such as China. I'd be a shade reluctant to buy more at that price, but they are still off their highs last year and should be held for the long term.
Elsewhere, though, the picture gets harder. This column has already looked at M&S (too expensive) and Next (ditto). Home Retail Group's problems have been well documented. We'll see if the new boss of Argos it has hired from America's Best Buy Group can turn things around. As for the shares, well, it might be best to keep a watching brief unless you're very brave.
The same goes for HMV. It is hard to see how chief executive Simon Fox can pull it out of its frightening slump. Selling the live music HMV Live to raise cash is depressing because it is a very good business. Again, this is one to avoid.
One which I quite like is N Brown. It is true that this clothes retailer's demographic is very similar to that of Argos. Companies serving "ordinary people", if you like, are not finding it easy, even where they discount aggressively. The failure of Peacocks is a good example. Debt was the killer, there, but it only became the killer because of poor trading. All the same, N Brown is a risk, but it's one I might be inclined to hold.
Sports Direct is one to watch rather than buy right now. It is expensive, at nearly 14 times earnings for the year to 12 April and the yield is pitiful. The company is also, to put it mildly, run rather eccentrically. But it will benefit from this year's sporting events even more than JD, and the company does have a habit of getting it done. Perhaps it helps that shop floor staff can earn bumper bonuses along with the executives if targets are met. It might be expensive right now, but could be one to buy on weakness.
I'd advise caution on SuperGroup, even though it has bounced back a bit after falling to earth last year.
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