January 20, 2014

Worst sign yet for B&N: Jim Cramer thinks they’re a good investment

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Giant Sloths! Can't lose!

Giant Sloths! Can’t lose!

The only thing Barnes & Noble has to do to be a great stock, according to Jim Cramer: outlast every other bookstore.

Cramer, your uncle’s favorite splenetic T.V. finance quack and Louis C.K pate-double, spoke at the Digital Book World conference in Manhattan last week. He was there to shill his newest book—Whoops!: Sorry About Costing Your Nana Her Life’s Savings, I believe it’s called—and decided to use the opportunity of his appearance to cast his world’s-most-beDockered-shock-jock wisdom pearls before the swine of the publishing industry.

Cramer had a lot to say, but the best parts are about everyone’s favorite free daycare for fellow mall employees, Barnes & Noble:

“Barnes & Noble will indeed become a stock that can be owned for investing purposes … If the Nook were shut, the stock would indeed thrive … The worse the Nook performs, the less materially it could drag down results. The company loses so much money per device, the less they sell, the less money they lose … Barnes & Noble has to wait until there are no more bookstores left and it’s the only one.”

Cramer is not wrong about the Nook. Holiday sales for the Nook were down 60.5% last year. And 34% the year before that. There have long been rumors that the Nook division might be sold entirely, and that Len Riggio might buy just the stores themselves. And as Reuters pointed out earlier this month, newly-named CEO Michael Huseby has experience in dividing the companies he helms. One imagines that most of the executives in the Nook subsidiary spend much of each day crouched under their desks diligently stitching the biggest most golden parachutes they can manage.

But after that is where Cramer really begins to shine. B&N, the store that earlier this month folded its former flagship location, just has to be the last bookstore standing, and it will be successful. Brilliant. Brilliant. Does anyone have any shades I can borrow? This guy is too brilliant. Is there a dosimeter handy? I feel like I’m bathing in some hard rads from the brilliance of this guy.

Indie bookstores are not going anywhere anytime soon. They’ll outlast B&N, they’ll outlast Books a Million, they’ll outlast Amazon. Whether they outlast them in the numbers we’d like to see is where the battle is being waged. They’re smaller, more versatile, more persistent. Cramer is like a guy standing on the tundra pointing to a mammoth proclaiming it a great bet after the ice age if it can just shed that hair and outlast other mammals, too bust hollering to see the voles beneath his feet.

Cramer also had some pithy advice for the success of the Big Five while at DBW. Essentially: be television, or something. Also, textbooks.

Honestly, who can loan me a sunhat? What SPF is this lotion? This guy is just too bright.

 

Dustin Kurtz is former marketing manager of Melville House.

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