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Did you ever want to go to Hooters to get a beer, watch some (ahem) football and open your wallet and all of your money is gone? Meanwhile the spousal unit is at the mall and she comes home with an armful of clothes? Then she tries them on and asks you if she looks fat in them? You have no answer for that, so she buys more clothes.
Today I bought CBK (Christopher & Banks) at 29.37 I will sell it in 4 to 6 weeks at 33.90. Here’s why I like CBK:
CBK’s stock is up over 225% off of its 52 week low. Despite this amazing price momentum, it’s PE is only 28.
Christopher & Banks runs a chain of roughly 466 stores aimed at women ages 35 to 55. It also runs a plus-size chain of 107 C.J. Banks stores, which carry women's casual clothes in sizes 14 to 24. Of course women wouldn’t want to be caught dead shopping there, but online orders have done very well. In fact, you get a coupon from Fatburgers with each plus size order from Chris & Banks (I’m kidding…kidding). About 40% of all of the clothing they sell is sweaters..perfect for those days when you’re feeling fat.
The company's business strategy includes providing target customers with high quality, moderately priced, coordinated ensembles that are interchangeable between work and leisure activities. Christopher & Banks has managed to average 32% annual sales and earnings growth since fiscal 2001 and management expects profit to rise more than 20% this fiscal year. There’s that word again…earnings earnings earnings.
Christopher & Banks' same-store sales are trending upward. For June they rose 2%. Management expects similar gains for the balance of the year. First Call analysts see full-year profit rising 23%.
Christopher & Banks plans to open 100 stores this fiscal year. It'll add roughly 70 Christopher & Banks stores and 30 C.J. Banks units. With the way we’ve all been eating, “growth” should really happen in the CJ Banks stores. CJ Banks also yields “larger” sales per customer. Yuk Yuk I murder me.
CBK has been able to remain highly profitable in a difficult retail environment. Their store expansion and market penetration will enable them to capitalize on any improvement in economic conditions. They should be able to hit $400 million in revenues which will allow them to bank $1.30/share of profit. At today’s PE of 28, this puts the stock price at $36.40 which is well past my sell target.
Return on equity has exceeded 20%, driven by wide profit margins, and achieved with virtually no debt. Return on assets is an oh-so-sweet 26%.
Bill Prange, Chairman and Chief Executive Officer of Christopher & Banks Corporation commented, "We anticipate finishing our fiscal year with approximately 535 stores in operation, further solidifying the position of Christopher & Banks and C.J. Banks in the marketplace. While we expect the retail environment will remain difficult for the foreseeable future, we are encouraged by our ability to continue to generate earnings increases during these challenging times. Given the increasing visibility of our brands and our ability to manage our business efficiently, we believe we will be able to benefit from any improvement in general economic conditions."
A tried and true formula for growth. Grow the # of stores and grow the sales. Eventually they will saturate the market, but that will be well after I get my 15% from this stock.
I am HUGE!!!
Today I bought CBK (Christopher & Banks) at 29.37 I will sell it in 4 to 6 weeks at 33.90. Here’s why I like CBK:
CBK’s stock is up over 225% off of its 52 week low. Despite this amazing price momentum, it’s PE is only 28.
Christopher & Banks runs a chain of roughly 466 stores aimed at women ages 35 to 55. It also runs a plus-size chain of 107 C.J. Banks stores, which carry women's casual clothes in sizes 14 to 24. Of course women wouldn’t want to be caught dead shopping there, but online orders have done very well. In fact, you get a coupon from Fatburgers with each plus size order from Chris & Banks (I’m kidding…kidding). About 40% of all of the clothing they sell is sweaters..perfect for those days when you’re feeling fat.
The company's business strategy includes providing target customers with high quality, moderately priced, coordinated ensembles that are interchangeable between work and leisure activities. Christopher & Banks has managed to average 32% annual sales and earnings growth since fiscal 2001 and management expects profit to rise more than 20% this fiscal year. There’s that word again…earnings earnings earnings.
Christopher & Banks' same-store sales are trending upward. For June they rose 2%. Management expects similar gains for the balance of the year. First Call analysts see full-year profit rising 23%.
Christopher & Banks plans to open 100 stores this fiscal year. It'll add roughly 70 Christopher & Banks stores and 30 C.J. Banks units. With the way we’ve all been eating, “growth” should really happen in the CJ Banks stores. CJ Banks also yields “larger” sales per customer. Yuk Yuk I murder me.
CBK has been able to remain highly profitable in a difficult retail environment. Their store expansion and market penetration will enable them to capitalize on any improvement in economic conditions. They should be able to hit $400 million in revenues which will allow them to bank $1.30/share of profit. At today’s PE of 28, this puts the stock price at $36.40 which is well past my sell target.
Return on equity has exceeded 20%, driven by wide profit margins, and achieved with virtually no debt. Return on assets is an oh-so-sweet 26%.
Bill Prange, Chairman and Chief Executive Officer of Christopher & Banks Corporation commented, "We anticipate finishing our fiscal year with approximately 535 stores in operation, further solidifying the position of Christopher & Banks and C.J. Banks in the marketplace. While we expect the retail environment will remain difficult for the foreseeable future, we are encouraged by our ability to continue to generate earnings increases during these challenging times. Given the increasing visibility of our brands and our ability to manage our business efficiently, we believe we will be able to benefit from any improvement in general economic conditions."
A tried and true formula for growth. Grow the # of stores and grow the sales. Eventually they will saturate the market, but that will be well after I get my 15% from this stock.
I am HUGE!!!
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