2012 and now operates over 3,000 stores throughout Asia. That’s nearly twice as many locations as Target has in the U.S. (1,807). (See chart to the right.) Physical retail has been a tough business for about a decade, as more and more shoppers prefer to buy everything from books to shoes online. Fast Retailing, on the other hand, has seen its share price soar. Since hitting a low in 2011 below 1,000 yen, the stock price has gone virtually straight up... climbing over 6,000 yen at its recent peak. This soaring share price has helped the company gain access to billions in additional, new capital. In 2016, Fast Retailing took on $2.4 billion in debt (moving its debt to equity leverage ratio from 4x to 47x) and the company’s CEO has announced plans to spend another $11 billion on a huge global expansion, moving into the U.S. and European markets. WHAT IS FAST RETAILING’S SECRET? Is it the mystery of embroidered shirt patches
Fast Retailing Dodges Retail's Long-Term Decline Business 10-Year Share Price Sears (SHLD) -96% JC Penney (JCP) -94% Esprit Clothing -83% Marks and Spencer (MKS.L) -45% Macy's (M) -44% Target (TGT) -14% H&M (HM.STO) 0% Fast Retailing (9983.T) 332%
and Google recently both saw their share price racing to $1,000. (Google won, twice – its shares previously passed the $1,000 prior to its 2014 stock split.) But they’re not the only nominal share price soar. There’s a host of super- expensive nominal share price companies today, like Priceline (PCLN), at $1,890, NVR (NVR) at $2,395, Seaboard Corp (SEB) at $4,150, AutoZone (AZO), at $600, and Intuitive Surgical (ISRG) at $930. Huge nominal share prices companies that have deliberately let their
nobody can pronounce? Is there something unique about its Vietnamese-made shirts...? No, of course not. What’s special about Fast Retailing, at least in the eyes of global investors, is its nominal share price. Not its market capitalization, the sum total value of its shares. The share price itself. Compared to its peers, Fast Retailing has a huge nominal share price, around 37,000 yen. Why should nominal share price matter? You might have noticed the sudden popularity of very large share prices. Amazon
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