Myer’s Share Price Climbs as Shoppers Flood Stores (ASX:MYR)
It was the spectacle that retailers were waiting for…
On Saturday, people flocked to shopping malls across Sydney. A welcome scene for two recently reopened Myer stores.
After weeks of isolation, it seems people are once again ready to spend. And for the iconic retailer, that is exactly what the doctor ordered.
More shopping, more sales
This morning has seen Myer Holdings Ltd’s [ASX:MYR] share price further its recent rally. Adding another 10% gain on top of Friday’s surge.
The move comes in the wake of a hopeful outlook for retail. As states across the nation begin to ease COVID-19 restrictions, it seems shopping is a top priority for many.
Australian Retail Association boss, Paul Zahra was certainly happy with the development, commenting:
‘[It is] great to see the obvious enthusiasm from Australians to get back to the shops after weeks of lockdown.
‘That’s a really great sign for retail, and a very natural response as Australians see the lockdowns starting to ease around the country.’
However, this recent bounce is based purely on optimism right now.
So, while it’s great to see people in stores once more, it doesn’t mean we’re out of the woods just yet. The reality is, until we get some hard data, we won’t know whether the recovery is in full swing or not.
This could very well be a short-lived celebration. Though we’re certainly hoping it isn’t.
Only time will tell where this road out of lockdown will lead us. Which is why you may want to be careful before investing in any retail stocks like Myer.
A long way to go for MYR
The fact of the matter is, Myer wasn’t doing too well even before this pandemic…
Their sales and profit have been sliding for years now. A slow decline that has been reflected in the collapse of their share price as well.
Management is going to need to do something special to turn things around, and quickly. Because even if the lockdown is soon to be but a bad memory, it won’t be enough to turn Myer’s fortunes around.
What they need is a plan forward. And right now, I’d be sceptical that they can deliver one.
That doesn’t mean it isn’t possible though. With the right strategy and execution, Myer could mount a comeback. The ball is firmly in their court in that regard.
In the meantime though, if I were an investor I’d be looking elsewhere. Myer is a stock to keep an eye on, but right now there are better prospects worth your money.
I recommend checking out our ‘Coronavirus Portfolio’ for a few ideas on how to play these volatile markets. Check it out for free, right here.
Editor, Money Morning