The landscape is filled with stores catering to ephemeral teen fashion tastes, but where does the busy professional woman go for help in building a reliable, coordinated wardrobe? There's a company based on Times Square that knows what to do.
AnnTaylor Stores Corp. (NYSE:ANN) is a national specialty apparel retailer for the professional woman. The firm operates 869 stores across the United States, targeting fashion conscious customers with clothes designed exclusively for its own outlets. Most signature Ann Taylor stores are located in malls and upscale retail centers. The chain's Ann Taylor Loft stores offer their own label of mid-priced apparel and Ann Taylor Factory stores offer clearance merchandise. The company also operates a pair of Web sites.
The firm pleased investors last week, when it announced Q4 EPS of 31 cents and revenues of $610.5 million. Analysts had been expecting 29 cents and $605.6 million. Further, management guided FY08 EPS to $2.15-$2.25 ($2.11 consensus) and the Board of Directors authorized a $300 million share repurchase program.
The ANN share price popped through its 200-day moving average on the news and has since been defining a bullish "pennant" consolidation pattern. Stocks frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.
Brokers recommend the issue with three "strong buys", three "buys", nine "holds" and two "sells". Analysts expect a fifteen percent average annual growth rate, through the next five years. The ANN P/E ratio (19.18), PEG ratio (1.27), Price to Sales ratio (1.22), Price to Book ratio (2.53), Price to Cash Flow ratio (11.30) and Price to Free Cash Flow ratio (14.88) compare favorably with industry, sector and S&P 500 averages.
Institutional Investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, ANN has traded between $32.25 and $45.15. A stop-loss of $34.00 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.
Closing Bell: Economic Catapult for Thanksgiving & Black Friday (WMT, TGT, GRMN, GOOG, MSFT)
Deere up on Q4 earnings performance
Reid Hoffman: LinkedIn will go public (at some point)
