Struggling American franchise of electronics retail stores,
), has launched two fresh concept stores in China and Malaysia.
The company also plans to expand its presence in the Asian market
by opening additional stores over the next year. Despite this
encouraging news, the company's shares declined nearly 3.0% since
RadioShack partnered with First Honest Enterprises Ltd and
launched its first concept store in China on Mar 21. The company
along with its franchise partner Berjaya Retail Berhad
re-launched an entirely modernized store in Kuala Lumpur,
RadioShack opened its first international concept store in
Bangsar, Kuala Lumpur, in Nov 2013. These concepts stores give
customers an innovative shopping experience. The new stores will
allow customers to compare products of different brands before
Notably, RadioShack and Berjaya Retail Berhad's subsidiary
have a long-term franchise agreement. The master agreement will
enable RadioShack's electronic chain to gain footprint in 10
Southeast Asian countries over a decade. The company sees
international expansion in developing as well as developed tech
market as a growth opportunity.
RadioShack currently has a Zacks Rank #5 (Strong Sell). The
company reported dismal numbers for the eighth consecutive
quarter. In fourth-quarter 2013, RadioShack's top and bottom line
missed the respective Zacks Consensus Estimate. More importantly,
the company's comparable store sales for the operated stores and
kiosks (stores and kiosks that have been operational for at least
a year) declined 19%.
Despite benchmarks touching all-time highs, the company's
shares have tumbled 34% over the past one year. We believe that
it will be difficult for the company to make a turnaround in its
business because of competitive threat from retail giants like
Best Buy Co., Inc.
). RadioShack's core Consumer Electronics retail business is on a
secular downtrend as lately, consumers prefer making online
purchases over visiting retail stores.
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