The retail stocks that remain in fashion
Some major chains are still attractive despite the decline of the high street, professional investors tells Harry Brennan
In towns throughout the country, once-thriving retail brands are closing stores. Online retailers have become hugely popular, offering low prices and the convenience of home delivery. Is the decline of the high street unstoppable? Department stores such as Woolworths and British Home Stores, which were once a familiar feature in many high streets, found themselves unable to evolve to meet the new challenge.
Marks & Spencer recently announced the closure of a number of stores and analysts have questioned its ability to retain its place in the FTSE 100 index in the long run; it only just made the cut in a reshuffle this week.
Two other high street staples, Mothercare and Moss Bros, the tailor, were relegated to the FTSE Fledgling index for small companies this week.
Years of aggressive expansion, most notably on the part of Tesco, have left well-known brands spread too thinly, in suboptimal locations, with large fixed costs.
Yet many customers still prefer to shop in bricks and mortar stores. And professional investors say they can still find high street retailers worth investing in.
Sacha Chorley, who runs multiasset portfolios for Quilter, the wealth manager, said: “There are still good companies out there, including plenty that are balancing their store
‘We think Tesco can double its profit margin’