Is it too early to pick winners from losers? Is it too early to anoint a company a survivor? The analysts sure don't think so.
We are seeing some Darwinian selection going on in many industries, so it might be pertinent to flag the winners and judge whether they are worth investing in.
. The destruction of
, as well as smaller outfits like
, has created an incredible opportunity for Best Buy to take a huge amount of share in the consumer electronic hardware business. I say tough one, as I have seen analysts put as much as 13 cents per share in winnings from closing Circuit City stores. But in the end I have to tell you that I do not like the business itself -- I fear the upside's been discounted as consumer electronics is easy to do without and I don't think 2009 will be a turn year for this kind of merchandise.
is such a winner over
and all the other major discounters that it is hard for me to believe it isn't game, set, match already -- except for
. I believe Wal-Mart is a big stock for next year precisely because it is the winner. (Odd, but Macy's is
to where it was before it got its credit agreement. That's a little too negative for me.)
: 2009 will be the year that these two feast off of everyone else and they will surprise in their share-take. It is time we call these two the winners vs. both cable and
, although the latter continues to stay in front of people in a way that makes Verizon and ATT spend tons, thereby hurting their bottom line.
Here's one that's ongoing and might make for a happy duopoly:
totally on the ropes
and will have to cutback or reorganize. In the interim, you are going to see CVS move in aggressively and Walgreen leverage its entrenched stores. (The latter has told people it has cut back its expansion, so it doesn't figure to take as much share as CVS.). This is a great theme for 2009.
is going to be the winner in the hardware/warehouse space in 2009.
is struggling and spending, but Lowe's has always taken advantage of downturns to take share and I bet 2009 will be
that it pulls away. I know
has a great balance sheet, but I know Lowes has it sights set on destroying Sears and I think Sears can't win that fight.
With so many of the casual dining places cutting back -- look at
-- this will be
year. It will all be about the balance sheet -- most of the restaurant companies overexpanded and do not have the balance sheet to take advantage of what I suspect will be bankruptcies galore in some really great locations. Panera will be
in the space.
has got good chances to expand too, but it will take those expansion plans overseas so it might not be evident.
, of course, is going to win out in the low-end fast food business.
Two that nobody are talking about that are going to be huge winners in the insurance space are
. These two specifically have not sought TARP money. If the new administration insists that TARP beneficiaries try to fix themselves, then you will get some opportunities for these two to expand. Travelers has
used turmoil to pick off players -- St. Paul's of late -- and I think that this time will be no different.
incredible quarter, with its aggressive sales people leveraging a series of good acquisitions, tells me that this database management player could take over this category. This company's a juggernaut -- I think that its competitors fall by the wayside. You just have to get behind this company if you think, as I do, that we have a realistic growth story.
There are some other obvious ones --
Research In Motion
-- but you don't need me to tell you about those.
Depending on price and whether you believe that the economy won't be falling off a cliff, there are some pretty darned good investments here.
Popular outpouring in droves toward
about ETFs that bully the market.
is now up and, like yesterday's installment, it's a must read.
Also, run don't walk, as Dougie says, to Kass's bottom call in housing, which I totally agree with. Prices have come down, mortage money has come down, the bargains are great and the people are on the sidelines. Not everyone is losing his or her job!
At the time of publication, Cramer was long WMT.
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