This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

10 Retail Stock Losers of 2011: Which Will Recover in 2012?

Stocks in this article: ODP OMX SPLS RSH GES PSUN TLB

7. RadioShack

Shares of RadioShack (RSH - Get Report) took a big hit in October after reporting disappointing third-quarter earnings and a disappointing outlook for the remainder of the year.

The electronics' retailer blamed the lackluster results on its transition in September out of T-Mobile wireless products and services and into Verizon Wireless. Mobile sales, which make up about 50% of RadioShack's total sales, rose 1.3% in the quarter, growing more slowly than expected. Sales of traditional consumer electronics also declined, tumbling 21%.

"The third quarter continued to be a challenging, continued to be a transitional period for us," said CEO Jim Gooch on a call with analysts at the time. "Our shift to a broader, more compelling wireless portfolio is definitely still a work in progress, I think both because of the carrier transitional issues as well as a continued difficult trend in the economy."

Looking ahead, RadioShack expects a drop in fourth-quarter profit from a year earlier because of a challenging economy and pressure on consumer spending.

Fitch Ratings recently downgraded the company's debt to "B+" from "BB" and said its outlook is negative. According to Fitch, RadioShack is saddled with $666 million in debt.

"The recent declines in (earnings before interest, taxes, depreciation and amortization) are more pronounced than expected, and Fitch believes there is greater uncertainty in the business," the ratings agency said.

The company is now working on increasing the visibility of its Verizon Wireless products and services, but analysts believe sales may take longer to build than originally anticipated.

RadioShack recently doubled its dividend and also approved a $200 million share repurchase.

Year-to-date, the stock is down 40%.

5 of 11

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs