Seeking Alpha

UBS analyst Michael Lasser thinks Best Buy (BBY) CFO Sheryl McCollum will need to be extremely...

UBS analyst Michael Lasser thinks Best Buy (BBY) CFO Sheryl McCollum will need to be extremely strict with the scarce resources at her disposal in order to help lead a turnaound at the retailer. A key decision for the newly-hired exec will be what to do with underperforming stores as leases come up for renewal next year.
From other sites
Comments (1)
  • billddrummer
    , contributor
    Comments (1741) | Send Message
     
    That's a good place to start.

     

    As I posted some months ago, as much as 15% of the company's big box floor space may be subject to lease renewal kickers:

     

    I discuss this issue here:

     

    http://bit.ly/Yem7nq

     

    and here:

     

    http://bit.ly/Qd8myH

     

    Finally, someone in the C-suite is actually looking at the numbers, rather than all the shiny store signs.

     

    I am aware of two stores which opened during the commercial RE boom of the mid 2000s, and which may be unprofitable at market rents.

     

    Both stores are looking at significant rent increases if the leases revert to market rates.

     

    As I've noted previously, it's lots easier to close stores if you're not publicly traded.

     

    http://bit.ly/QNw5tc

     

    Not to say that closing stores isn't disruptive no matter your ownership, but you don't have to sell it to shareholders in a conference call.

     

    We will see what happens.

     

    Time will tell, as it always does.
    17 Dec 2012, 10:31 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs