Albertsons IPO- no status

[BillyGr]

Economics are everything. While Shaw's/Star Market can definitely go as far as non-core assets go...that is the ONLY division that hasn't seen significant remodels or new store announcements, not to mention it wasn't even part of the American Stores division and doesn't have a big history with either company.

Probably true, but they also haven't had significant closings either. They must be doing something right or close to it, because Cerberus is all about the mighty dollar.

Perhaps part of it is that they have a number of areas where they have limited (and even some stores with no) competition?

Unlike the Acme section where there are still a number of competing chains (slightly less without A&P/Pathmark but not much) so that may be why that area is getting more remodels and newer stores?

[pseudo3d]

Economics are everything. While Shaw's/Star Market can definitely go as far as non-core assets go...that is the ONLY division that hasn't seen significant remodels or new store announcements, not to mention it wasn't even part of the American Stores division and doesn't have a big history with either company.

Probably true, but they also haven't had significant closings either. They must be doing something right or close to it, because Cerberus is all about the mighty dollar.

Perhaps part of it is that they have a number of areas where they have limited (and even some stores with no) competition?

Not really, the stores in Texas still hang on despite some heavy competition from Kroger and H-E-B (though many have closed in the past). The Louisiana stores also face significant competition, and Arizona also has competition with Fry's (Kroger).

[klkla]

The unemployment rate is massively skewed...it doesn't account for underemployment or those who just gave up searching for jobs due to the poor economy.

That's a myth. Unemployment has been measured the same way for over 35 years. Therefore a comparison between each month in that time period is very relevant.

Trying to factor in people that are not searching for work is also false logic. America's population is aging and there are more retired people every year. Most of them are not looking for work. Same with disabled people. They are included in that demographic and it will continue to grow no matter what.

Moreover, things at Albertsons are shaky enough that moves like that will scare off investors and erode confidence in a company that is already on pretty shaky ground as is.

Selling some assets and paying down debt would not scare off investors. It would give them confidence that Albertsons is viable long term. They clearly do not feel that way now. If they did Albertsons would have already done their IPO.

[veteran+]

"If economics were everything they would be able to do their IPO now. The economy (GDP) has grown for seven years in a row. Unemployment is the lowest it's been since April 2008. All the well run companies in this industry are very profitable. The stock markets are near or at all time highs."

Salient point klkla.

From where we WERE to where we are the GDP has grown quantifiably.

I wonder what the growth rate was after the Great Depression of 1929?

[pseudo3d]

The unemployment rate is massively skewed...it doesn't account for underemployment or those who just gave up searching for jobs due to the poor economy.

That's a myth. Unemployment has been measured the same way for over 35 years. Therefore a comparison between each month in that time period is very relevant.

Trying to factor in people that are not searching for work is also false logic. America's population is aging and there are more retired people every year. Most of them are not looking for work. Same with disabled people. They are included in that demographic and it will continue to grow no matter what.

While the measures of unemployment are technically consistent (measured by U-3, which includes "Jobless and Seeking Work"), the measure of marginally-employed people/part time for economic reasons sharply rose following the recession and has not dropped down to the level it was pre-2007.

Moreover, things at Albertsons are shaky enough that moves like that will scare off investors and erode confidence in a company that is already on pretty shaky ground as is.

Selling some assets and paying down debt would not scare off investors. It would give them confidence that Albertsons is viable long term. They clearly do not feel that way now. If they did Albertsons would have already done their IPO.[/quote]

Albertsons cancelled their IPO initially because that was the day Walmart announced they were closing stores, sending stocks downward, and since then the market has been shaky with Brexit and uncertainty in the Chinese market. It's not just Albertsons. For the first five months of 2016, only 31 companies went with an IPO. In 2015 the number was 69 that time of the year, and in 2014, 115. (source)

Albertsons has problems, of course, I don't think any of us debate that. But it's not as big as you think it is, though there's no way I can convince you of that--considering you also put all the blame to Albertsons regarding the whole Haggen fiasco, I have to assume you're just that anti-Albertsons and you're never going to let go of that view.

Now, is Albertsons perhaps playing it too safe? Maybe. The longer this drags on, the harder it will be for them to gain a meaningful and strong start.

[klkla]

Yes but ABS has been trying to float an IPO almost immediately since they bought Safeway.

[klkla]

I wonder what the growth rate was after the Great Depression of 1929?

It was World War II that finally changed the economic dynamics that got us out of the great depression after 12 years.

[storewanderer]

Yes but ABS has been trying to float an IPO almost immediately since they bought Safeway.

I get the impression they were looking for a quick deal on the IPO and now it has not been so quick. ABS spent the first half of this year buying what felt like almost every store it could get its hands on, will that trend continue going forward? I was surprised they only got one store out of the Ahold/Delhaize transaction. I will also be surprised if they do not come forward as a buyer of Rite Aid/Walgreens Stores that are pending divest.

They can try to grow all they want but when you look online at what customers are saying about the stores it is not so good.

It would be interesting to see what division(s) they may sell if they opt to do that. That would sort of kill the whole growth story though. Or would it? Sell off assets deemed non core to invest in the business, consider other strategic acquisitions, buy back shares (doesn't apply at this point since they have not IPOed) and pay down debt? Yikes, that sounds a lot like what Safeway said when it sold Canada off...

[veteran+]

I wonder what the growth rate was after the Great Depression of 1929?

It was World War II that finally changed the economic dynamics that got us out of the great depression after 12 years.

Yeah, I know but previous to WW11 and all the massive FDR initiatives, I wonder what the growth rate was.

I ask only because of all the rhetoric of how bad things are sans the real comparative analysis.

For example:

Say a company had a 15% sales decline for the previous year versus a 2% increase for the current year, people tend to focus on the tiny 2% increase.

Or, the opposite (Tesco/Fresh&Easy were famous for playing with this) if you brag about a double digit increase in sales yet your average volume is $75,000./week................that double digit increase is really silly and insignificant (at least in retail grocery).

Real growth stats should have relative and comparative values (in context of course) to have any meaning at all. Otherwise it's just propaganda serving a narrative.

[klkla]

Real growth stats should have relative and comparative values (in context of course) to have any meaning at all. Otherwise it's just propaganda serving a narrative.

True. The two periods are difficult to compare because the severity of the 'great depression' was so much greater than the 'great recession'. Plus so much more has been learned about economics since then.