RadioShack Corp.'s (RSH) difficulties persists as the company's first-quarter 2012 financial results were pathetic. The company's core consumer electronics retail business is on a secular downtrend and is unlikely to be revived in the near future. Customers increasingly prefer online purchase instead of visiting brick-and-mortar retail stores.
Loss of footfall is taking a toll on RadioShack's mobility business, on which the company is banking for its future growth. Further, instead of computers and cameras, majority of consumers prefer tablets and smartphones, which are less profitable for the retail industry.
In the last quarter, comparable store sales for the company-operated stores and kiosks decreased 4.2% year over year. This is a key retail performance indicator measuring growth from existing sales locations. We do not find any immediate growth catalyst and thus reaffirm our Underperform recommendation.
RADIOSHACK CORP (RSH): Free Stock Analysis Report
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