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After a long six months of watching retail sales continue to slip, we get a bit of good news today, as January retail sales actually moved a bit higher.Continue reading Retail sales make surprising jump in January
In his Half-Priced Stocks newsletter, value investor Nathan Slaughter recently assessed stocks based on the general investment philosophy of Benjamin Graham, the noted value investor under whom Warren Buffett studied.
One issue that stands out in his view is Cabela's (NYSE: CAB), one of the world's largest specialty retailers of hunting and fishing gear, camping equipment, and outdoor apparel.
"The cornerstone to Graham's success and his enduring legacy to value investors was his 'margin of safety' concept. Specifically, he would take a hard look at dividend yields, price-to-book ratios, and other key metrics.
"Cabela's originated as a direct marketer and once primarily sold its products via catalog, but has since augmented that distribution channel with e-commerce operations and a growing chain of nearly 30 stores spread throughout 19 states.
Continue reading Cabela's (CAB): 'Sporting gains' from Ben Graham-style buy
For the first time in about two months, shares of Big Five Sporting Goods (NASDAQ: BGFV) are below $24 as a result of cutting its second quarter forecasts thanks to worse-than-expected same-store sales growth. While the market reacted semi-dramatically, sending the stock down more than 5%, I believe this decline in growth is only a hiccup in the company's growth story, especially because this is the company's first quarterly decline in same-store sales growth in 11 years.
While many would expect a value investor to jump on the opportunity to purchase a good company after a slip-up, I don't think that Big Five offers much value, at least when compared to a similar company: Cabela's (NYSE: CAB). To start, I believe the two companies are in fact very good comparisons -- they are similar in nearly every regard: multiple to this year's earnings, multiple to next year's earnings, multiple to sales, multiple of enterprise value to EBITDA, balance sheet dynamics (relatively speaking, very close debt/equity ratio), operating margins, etc.
As the story continues, it seems that Cabela's is actually cheaper than Big Five, despite the company's recent fall. Why?
Continue reading Big Five: Even after fall, still not enough value
The ninth name in my series of the top 25 stocks for the NEXT 25 years is Dick's Sporting Goods Inc. (NYSE: DKS). Dick's is headquartered in Pittsburgh, Pennsylvania, and was actually established in 1948. The original concept was revamped and expanded during the past four years, and the company is on a high-growth trajectory. Dick's will be the most dominating purveyor of sporting goods and apparel in the United States.
Dick's stock closed at $53.40 on Friday and has a market capitalization of $2.8 billion. Dick's currently operates 294 stores, most in the eastern United States. The estimated revenue base for the fiscal year ending January 2008 is $3.8 billion, and for earnings per share I am estimating at $2.40. My January 2009 revenue and earnings per share estimates call for $4.5 billion and $2.95.
Dick's is taking advantage of a very fractured market. The preponderance of sporting goods sales occur in the big box retailers like Wal-Mart Stores (NYSE: WMT) or Target Corp. (NYSE: TGT). It's simply a "small department" for these huge general retailers. The other big competitors have been mom-and-pop stores and a few other larger concepts that have struggled mightily. Dick's is both the growth engine and the consolidator in the sporting goods space. The company has room to grow to 1,100-1,200 stores over the next decade. In 2005, Dick's acquired popular Midwestern retailer Galyan's and with it, the terrific locations.
Sporting goods that Dick's offers range from the usual baseball, football, basketball, and hockey equipment and apparel to the eclectic tastes in golf, fishing, hunting, and more. Dick's is attuned to the electronic world and offers the best line of navigational equipment for boaters and fishermen. What Dick's offers to the sportsman is total selection and information by extremely well-trained salespeople.
Continue reading Top 25 Stocks for the NEXT 25 Years -- Dick's Sporting Goods
In a move that will most likely be appreciated by most Americans, Wal-Mart has decided to remove the sale of guns
from its store shelves. Instead, it will stock sporting goods that more accurately reflect the community in which it
operates. With the new U.S. sales head being all about customizing the Wal-Mart store experience to local flavor, this
is no surprise most likely.| # | Blogger | Posts | Cmts |
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| 4 | Steven Mallas | 43 | 0 |
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| 8 | Steven Halpern | 32 | 0 |
| 9 | Melly Alazraki | 26 | 0 |
| 10 | Paul Foster | 25 | 0 |
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| 12 | Brian White | 22 | 0 |
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| 16 | Elizabeth Harrow | 19 | 0 |
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