Another retailer has filed for bankruptcy.
Lord & Taylor, the oldest department store in the U.S., became the latest retailer to file for bankruptcy protection, joining apparel retail conglomerate Tailored Brands.
Lord & Taylor, which has roots that go back to 1824 and was purchased by French clothing rental start-up Le Tote in a $100 million deal last year, said that its 38 locations have been temporarily closed since March 2020.
Lord & Taylor's bankruptcy filing came on the same day that Tailored Brands, the parent company of Men's Warehouse and Jos. A Bank, filed for Chapter 11 protection as the coronavirus lockdown has had a devastating effect on apparel retailers, many of whom were already saddled with debt due to expansion efforts in recent years.
"Went down 42 Street yesterday, It was like being transported to New York City circa 1979, where you pretty much figured you would be mugged at night. You would look both ways coming out of Grand Central Terminal, not for cars, but for the possibility of an attack, they were that numerous," wrote Jim Cramer in his daily Real Money column.
"Of course, the decimation of so many stores comes from the virus. You see so many vacant or boarded up storefronts and you recognize the names: the independents, the ones intrinsic to the city. The survivors? The pointless banks that are open only during the week and therefore make the 42 Street gauntlet that much more difficult on the weekend and, of course, the international clothing chains like Zara and H&M. How long before the well-situated, at least at one time, Loft, owned by the now-bankrupt Ascena, closes?"
Jim Cramer outlines the rules to follow when investing in a retailer at his point.
What rules do you follow when investing in the retail sector?