Retailers most often feel the brunt of economic downturns, and the recession that manifested throughout 2008 and 2009 clearly impacted the valuations of nearly every publicly-traded retailer.  At the height of the financial crisis in December 2008, the market values (calculated as share price times number of shares outstanding) of numerous retailers were approximately 40% of their respective values at the beginning of 2007, prior to the economic downturn.  

Most retailers realized gradual gains in their share prices throughout 2009 and 2010, although the results have varied by the type of retailer.  In general, retailers that market products that are non-discretionary (essential) goods, such as groceries and general merchandise, have realized a stronger recovery in their valuations since early 2009. For instance, the values of retailers that sell predominantly home products are currently valued at about 95% of their respective values prior to the recession.  

Retailers that sell clothing goods have realized a moderate recovery, with these retailers trading at about 75% of the value at the beginning of the recession.  Clothes are not considered as essential as home or grocery products, but clothing is a necessary item, and these retailers tend to recovery quickly from recession lows. 

Electronics products are located even further down the scale from essential items to discretionary items. These retailers were hit hard in the recession, some large 'big box' electronic retailers, such as Circuit City and Ultimate Electronics, eventually were forced into bankruptcy due to the economic recession.  The remaining publicly-traded retailers of electronics are currently trading at a value about 65% of their pre-recession values.  

Finally, bookstore retailers, already hit hard by the economic downturn, are continuing to struggle due to the intense competition from internet-based book retailers and the growing popularity of 'e-books'.  These retailers, which have market values of about 40% of their pre-recession values, are unlikely to ever achieve their historic valuations.  

This analysis is based on historic valuations of 46 publicly-traded companies operating predominantly as retail businesses in the United States.  Equitas Valuation LLC publishes business appraisal toolkits that provide business owners with everything needed to perform a business appraisal of their business interests.

View details of the Equitas Business Appraisal Toolkit for Retailers