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Dillard's: A Fashionable Investment That Is Still In Style

Aug. 03, 2021 10:10 AM ETDillard's, Inc. (DDS)AMZN, BURL, COST, EBAY, JWN, KSS, M, TGT, WFC, WMT17 Comments
Dwight Baker profile picture
Dwight Baker


  • Dillard’s positioned itself well to survive the pandemic, and to thrive in the "new-normal" age.
  • Picking market areas for new stores is very selective. Dillard’s appears to avoid too much direct competition.
  • Dillard’s stock is at or near fair value, with potential for over a 13% increase to $203.88 in 6 months.

InStyle x Vionic: Secrets to Spring Style
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Dillard's Inc. (NYSE:NYSE:DDS), like many other companies, was hit hard by the pandemic. Dillard's revenues and earnings dropped substantially during 2020. But Dillard's is in the business of style, and looking at the recent

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Dwight Baker profile picture
I am an individual investor with over 30 years experience trading stocks and ETF's. I have researched stocks in a wide range of areas such as telecoms, REIT's, manufacturing, and energy to name a few. I expect to supplement my retirement with income derived from stock trading and dividends. My current focus is steady dividend income balanced with high growth opportunities. Anything I write may be considered a first step toward due diligence but it is my personal opinion only. I strongly recommend consulting an experienced, registered and qualified investment advisor before making all investment decisions.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Please note that I am not a financial advisor. The article should not be considered as a suggestion to buy or sell this or any other stocks. Consider this one source of a full range of due diligence you should undertake, but is entirely my personal opinions. It is strongly recommended that you consult an experienced, qualified, and registered investment advisor before trading.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (17)

Share price up 8% today to all time high. I can't seem to find any news. Am I missing anything?
Dwight Baker profile picture
@SilverViking Not sure either, but maybe it's just readjusting value. I have an updated article coming out soon if you are interested.
Knux profile picture
13 Aug. 2021
Would just like to share with you that I followed this play into a big swing play for myself. Bought pretty big on the day after you posted this, at nearly the bottom of a recent dip. (160) Sold out today at 205 after it was clear the double top was in.

You're gaining quite the following aleady! I'm really proud, and you deserve every bit of it. You're going to single handedly pull this website out of the gutter. Maybe you'll eventually land a big writing job and get the proper returns on your hard work. Put me down as a reference!
Dwight Baker profile picture
@Knux Thanks, I'm glad this one worked out for you. I think this still has some room to grow over time, and if it goes well.
Capt Stu profile picture
that is some short interest!
HootieTreads profile picture
Bought last year in the $20s and sold out in the $90s after it got sucked up in the $GME squeeze- wish I held!

Simple market mechanics tell me that if they continue share buybacks than at
a 4B market cap with 15M shares o/s, you're looking at $266 a share!

This is $AAPl share buybacks on steroids. I also think they could split the stock at 3:1 or 4:1, the dividend is not that high and they could support it.
Dwight Baker profile picture
@HootieTreads Good points, and congrats on a great return.
Ghentite profile picture
It seems Dillard's also avoids areas with Lord & Taylor, at least in northern Virginia and I don't remember seeing any in Hawaii when I was stationed there.
Dwight Baker profile picture
@Ghentite They pretty much haven't made it to the northeast, not sure if/when they may. And Hawaii's distance from the mainland probably explains that one. Other, more low hanging fruit elsewhere.
I haven't looked at it for a while but one advantage is that it owns most of their stores, so it has great cash flow. A year ago it was heavily shorted in spite of the high cash flow, high insider ownership, and repeated stock buybacks, leading to a bit of a short squeeze.
Dwight Baker profile picture
@rcray Yes, and the real estate value is a major asset.
I prefer Kohls primarily because they have most of their stores in free standing locations as opposed to being in a large mall. DDS, JCP, and M are more mall based.
Dwight Baker profile picture
@southbuckeye Good point, but I would say they are not just in a mall but often are the anchor store of a mall.
@Dwight Baker I know you are a fan of dividends as well as growth. KSS pays out about a 2% dividend yield, while DDS pays out about a third of one percent yield. If things go south for the next few months due to Covid, I'd rather collect KSS's dividends than DDS's while I wait for the stocks to resume their climb. If Covid gets out of hand in the U.S., which I DON'T believe to be the case, then any investment in KSS or DDS would not be a profitable one.
Dwight Baker profile picture
@southbuckeye There are certainly risks involved. I do like dividends too, but of course you have to look at a lot of factors. In this article, I'm not really running with a thesis that this company is a better or worse investment than any others in particular though.
Thanks for the update. Many people don't realize management has done a better job than Amazon over the years and the stock reflexes that.
Dwight Baker profile picture
@bbobileee YW - I was impressed at how well they performed during the shutdowns and after.
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