Money Investor
Long/short equity

Big Lots: Small Discount Retailer With Big Problems

Big Lots, Inc. (NYSE:BIG) operates as a closeout retailer in the US and Canada, with over 1,500 stores in operation as of June 2013. The company recently reported earnings, disappointing the market with its tepid forward outlook. Since that time, shares are down roughly 15%, pushing the company into a perceived value territory from a forward PE ratio standpoint. This is a company that investors are better off avoiding, or doing as fabled retail mega investor Eddie Lampert just did, and liquidating their stake in this retailer entirely. Big Lots is stuck in a retail industry filled with fierce competition, wandering in search of a value proposition to offer consumers. The explosive growth in store count from...

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