TRUE RELIGION
TRLG
The screen produced this little company. Growth: very strong (0.9, 1.2, 1.45 for 05 06 07 respectively). Large cash with no debt; Valuation reasonable, traded at about 16.5X of its 06 EPS, with greater than 20% earning growth. Very strong return on equity and capital and the company generates significant free cash flow. I have a few nagging concerns though. (1) The company is not only very small ($400 mil. Market cap, but also very young). (2) It is in the apparel industry, where competition is fierce, and the lifespan of a brand name could be very short. Fashion could change over night. I am also hesitate to open a position here in front of its Q4 earning report. I think it probably is better to wait for the earnings and then decide what to do next.
The screen produced this little company. Growth: very strong (0.9, 1.2, 1.45 for 05 06 07 respectively). Large cash with no debt; Valuation reasonable, traded at about 16.5X of its 06 EPS, with greater than 20% earning growth. Very strong return on equity and capital and the company generates significant free cash flow. I have a few nagging concerns though. (1) The company is not only very small ($400 mil. Market cap, but also very young). (2) It is in the apparel industry, where competition is fierce, and the lifespan of a brand name could be very short. Fashion could change over night. I am also hesitate to open a position here in front of its Q4 earning report. I think it probably is better to wait for the earnings and then decide what to do next.
posted by ZIGZAG at 3/08/2006 10:07:00 AM
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