Welcome to Industry Focus, the podcast that dives into a different sector of the stock market every day.

It's Tuesday, October 8th, and we're talking about spinouts in the retail sector.

I'm your host, Dylan Lewis, and I've got Fool dot com's Dan

Klein with me on Skype. Dan what's going on my man?

Ah not too much. We're heading from super summer into regular summer here in West Palm Beach

so moving from the 90s to the 80s and it's delightful.

And we've finally hit fall here in DC. I busted out my jeans and my hoodie for the first time

this past weekend. I gotta say, like like there was a little spring in my step.

See that's a sign you're going to be seeing less of me in the office is when it starts

to get colder. That's probably wise and I guess Jeans in a hoodie a decent transition of what we'll be talking about today

We're going to be spending a lot of time talking about J crew taking its denim brand made well public and we're also going to be talking about another retail spin-out that's Old Navy being spun out of Parent Gap. But before we get

into the company's specific discussion let's talk a little bit about this mini trend that we're

noticing with these spin-outs. So really what's happening here is you have two

companies owned under the same umbrella. One is struggling and one is doing well. And if that was

happening in your real life, let's say you made really good money and your

spouse didn't, well it's okay to kind of mix those finances because nobody needs

a true picture of what's going on.

But in the case of two retail brands, what you don't want to do is have one successful

brand sort of propping up the losses for a struggling brand.

Now obviously you can report and show what's happening,

but if you can't pay your rent at the struggling brand

and there's money at the successful one,

...