'Nobody's immune': More retail bankruptcies are looming
The share of retailers that Moody's covers and that have the weakest liquidity scores - meaning they will likely default within the next year - has risen to 10%, up from 6% in December 2016.
"Nobody's immune," the analysts wrote in the report.
Moody's has identified 22 retailers - up from 19 in February - that are "heavily distressed" and in danger of defaulting.
Moody's Investors Service
Department stores are in the most trouble, while at the other end of the spectrum, discount and dollar stores are seeing fairly healthy growth.
That's because shoppers developed a habit during the recession of visiting discount stores and avoiding paying full price for anything. Many never returned to shopping full price after the economy started recovering.
"The US retail sector has been thrown into a state of unprecedented flux as competitors race to stay ahead of increasingly demanding, less predictable consumers," analysts wrote. "Strapped department store retailers and others are finding that once-loyal shoppers are morphing into value-hungry, Internet savvy consumers."
Even grocery stores are feeling squeezed by changes in shopper habits, analysts said.
Moody's Investors Service
"Virtually every sub-segment of retail, other than auto retail and pharmacy, are caught in the cross-hairs of Amazon's growing online presence," analysts wrote. "Even strong industry performers are looking over their shoulders."
The analysts cited long-dominant grocery chain Kroger as one such company that is suddenly under pressure.
Moody's Investors Service
- As English players begin their premature IPL exodus, Gavaskar calls for action against England Cricket Board
- Top 10 destinations for river rafting in India in 2024
- Should you enrol your child in an online university like IGNOU?
- Mobile recharge packs to get more expensive as telcos gear up for another round of tariff hikes: Report
- Bharti Airtel net profit tanks 31% to ₹2,072 cr in Q4
- Nothing Phone (2a) blue edition launched
- JNK India IPO allotment date
- JioCinema New Plans
- Realme Narzo 70 Launched
- Apple Let Loose event
- Elon Musk Apology
- RIL cash flows
- Charlie Munger
- Feedbank IPO allotment
- Tata IPO allotment
- Most generous retirement plans
- Broadcom lays off
- Cibil Score vs Cibil Report
- Birla and Bajaj in top Richest
- Nestle Sept 2023 report
- India Equity Market