What's So Special About RadioShack? - Barron's

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Includes: AAPL, BBY, RSH
by: Rachael Granby

RadioShack (NYSE:RSH) shares are up 57% in six weeks, but Barron's Kopin Tan thinks the jump is without justification.

RadioShack's same-store sales rebounded to 6.9%, helping beat Q2 estimates, but sales were helped by stimulus checks whose effects have largely worn off.

There was some speculation RadioShack might begin selling Apple's (OTC:APPL) 3G iPhones, but Best Buy (NYSE:BBY) nabbed the coveted spot as first retailer of the popular devices. CEO Julian Day has cut costs and the wireless business has improved. Still, unless consumer demand starts to turn around and RadioShack starts to experience the popularity it once had, the jump in stock price might be unsustainable.

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The Fed's Beige Book noted electronics items were one of the top rebate check beneficiaries. Now that they're used up, recent outperformance may quickly evaporate.

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