Discount index reports 33 of 47 stocks monitored declined

Discount Store News, August 18, 1986

Discount Index Reports 33 of 47 Stocks Monitored Declined

Discount retailer stocks were down significantly for the two week period ended July 25, following the general market trend.

Eight of the top 10 discount chains posted declines including Wal-Mart, Zayre, Service Merchandise, Best Products, Price Club and Ames Department Stores. Only the nation's largest discount retailer, K mart, and seventy-ranked Toys "R' Us, reported gains of 1.87% and 2.34%, respectively.

The DSN Discount Store Index registered a decline of 2.94%, one of the largest percentage decline this year.

In addition, other stock indexes recorded declines during the July 11 to July 25 period: Dow Jones Industrial Average declined .63%; Standard & Poor's 500-Stock index declined .83%; New York Stock Exchange Composite declined .79%; and the Value Line Index declined 2.65%.

Overall, 33 of the 47 stocks monitored posted declines, with four retailers --Best Products, Grand Auto, Pace Membership Warehouse and Service Merchandise--posting new lows.

The largest percentage decline for the period monitored was experienced by Ames Department Stores, down 14.42%. The company's share price dropped from $30.38 to $26.

Other retailers posting the highest percentage declines were: Burlington Coat, down 11.49%; Federated Group, down 10.62%; Grand Auto, down 12.31%; Lucky Stores, down 10.34%; and Pic 'N Save, down 13.82%.

On a more optimistic note, 11 retailer stocks advanced led by Crazy Eddie, which posted a 16.06% increase. The company's share price rose from $34.25 to $39.75. Increases in the stock price were fueled by the New York-based consumer electronics chain's announced entry into the arena of home shopping networks. (See story on page 1.) The chain's intention to explore television retailing came on the heels of significant gains in sales and net income for the first quarter of fiscal 1987, ended June 1. Crazy Eddie posted a 113% increase in net income and a 41% increase in sales for a record $64.5 million.

Roses Stores reported the second highest percentage gain with a 7.32% increase for the reported period. The share price jumped from $41 to 44.

Other retailers posting advances were: Alexander's, up .69%; Family Dollar, up 2.09%; Pep Boys, up 3.13%; Super Valu, up 1.49%; Syms, up 6.64%, and Toys "R' Us, up 2.34%.

Table: Major Indexes

Table: Discount Store Index vs. Dow Jones Industrial Average

Table: Discount Industry Chain Stock Analysis Table