Dillard’s, Inc. (DDS) Flies High in a Troubled Industry

One of the early attractive features of Dillard’s, Inc. (NYSE:DDS) before its run-up in stock price was its real estate portfolio — a common thesis for large retail store investing. The company is shutting down poor-performing stores and investing in the remaining square footage. This smart capital management will likely keep the company on solid footing going forward. Also to note is the recent quarter’s segment performance, which shows home and furniture as the worst department. As the housing recovery continues in the U.S., there may be some growth in these areas, especially as the stores are renovated and inventory is updated.

Overall, Dillard’s, Inc. (NYSE:DDS) appears to be valued fairly at neither a considerable discount nor premium to its intrinsic value. Investors encouraged by management’s ability to control costs and use capital may want to take a closer look, but this is no longer a value-oriented story. Still, in an industry subjected to plenty of turmoil in recent years, Dillard’s, Inc. (NYSE:DDS) appears to be an outperformer.

The article Dillard’s Flies High in a Troubled Industry originally appeared on Fool.com and is written by Michael Lewis.

Fool contributor Michael Lewis has no position in any stocks mentioned. The Motley Fool owns shares of Dillard’s.

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