Death By Amazon – January 2017
Following brutal reports from a few different department stores this week, we mentioned our Death By Amazon Index in a blog post yesterday. Today, we updated that index in one of our B.I.G. Tips reports. Below we chart the performance of the index versus Amazon (AMZN) and the S&P 1500.
To see the report, which includes more information about the construction of the Death By Amazon Index, its performance, and the stocks that make up the index sign up for a monthly Bespoke Premium membership.
Death By Amazon Lives Up to its Name
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With big blowups from Kohl’s (KSS) and Macy’s (M), it was a bloodbath for retail related stocks today. A perfect illustration of this weakness was the performance of our Death By Amazon Index. Bespoke’s “Death By Amazon” index was created in 2014 as a way to track the performance of the companies most affected by the rise of Amazon.com (AMZN). Companies included must be direct retailers with a limited online presence (or core business based on physical retailing locations), a member of either the Retail industry of the S&P 1500 Index or a member of the S&P Retail Select Index, and rely on third party brands. We view these attributes as the best expression of Amazon’s threat to traditional retail.
Of the 54 stocks that currently make up the index, all but seven were down today, and the average return of the 54 stocks was a decline of 3.57%. The table below lists the best (stocks that were up) and worst (stocks down 5%+) performing components of the index in Thursday’s trading. Leading the way to the downside were KSS and M, which proved today why they were included in the index in the first place! Other big losers included Dillard’s (DDS), J.C. Penney (JCP), and Nordstrom (JWN). On the upside, the only two stocks that were up more than 1% on the day were CVS Caremark (CVS) and Costco (COST). Meanwhile, while the Death By Amazon Index sank today, Amazon’s stock feasted on the weakness, rising 3.07%.
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