Would RadioShack be an ideal stock to invest in..?

Question

why or why not.. give some explanations... history of profits..future profits etc.

thanks

Answer 1

Ideal? Only if you worked for, or frequently bought from, the company.

It recently had some cutbacks, which translated into short term profits without those extra salaries and benefits to pay for. But, as I discovered with another company who sold some ships a while back, the decreased capacity, in the somewhat longer run, means reduced capacity to make money. Unless Radio Shack really and truly just culled out the dead weight, that means there are fewer bodies to make the business go. The remaining staff will certainly pick up the pace, but there are limits unless you are changing what they do. I haven't heard of that happening.

Still, KeyBanc did raise their rating of RSH from "underweight" to "hold" a couple of days ago. Not exactly an "ideal" recommendation. If you have it, don't worry. If you don't, maybe you could keep shopping (look up CVX while you are at it: good dividends, good earnings, good prospects, and a rediculously low book value for its oil reserves).