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Full disclosure, I bought this stock back in 2004 and sold it after a couple of months for a quick gain. I like the stock and the write up back then, and I like it again now:
Sniffffff…..Ahhhhh….can you smell the chemistry? Let me tell you a story about aroma. When I was a sophomore in college, there was a girl in our dorm who, for whatever reason, I was always thinking about. Let’s just call her “Jane”, to protect the guilty. Understand that $$$MR. MARKET$$$, in those days, only sported 16” biceps rather than the 19” monsters I presently carry around. As a result, I was not as confident in my pursuit of “happiness” as I could have been. Anyway, in the basement of the King’s Court dormitory was this pinball machine called “Countdown”. Back then, having high score on “Countdown” was probably the equivalent of winning the Heisman Trophy (well, at least for me it was…).
One late afternoon, after a typical lunch of 18 beers, Chili Con Carne and a meatball sub, I was flailing away at “Countdown”, really banging that pleasure machine. I was on my 3rd ball…and it was one of those magic balls…I had knocked down all the flags and every bumper I hit was now worth mega points. I was on the verge of scoring an “extra testicle” which would have assured me the almighty High Score! And I had the trustworthy Tovsky as my witness! Needless to say, all of this excitement was causing me to lose most of my sphincter function, and a certain amount of anal leakage was taking place. Well, actually it was more of a flood, than leakage. Let’s just say they could have drawn a geology map around all of the natural gas that was being produced at this West Philly location in the King’s Court basement.
Of course, that’s when Jane walks over to the pinball machine and says, “Hi there, $$$MR. MARKET$$$!” Now I could have let the ball drain, made a quick dash for the soda machine and bought my dreamgirl a soda, and then make a statement like, “Gross…Tovsky what have you been eating???”. You know the old “supply, deny eject and deflect” trick. Of course I didn’t though. What college boy would ever turn down a shot at the Heisman? Jane, on the other hand, was a little less than impressed by my quest. The words, “Ewwwww….yechhhh…and blechhhh!” somehow linger in my memory the same way the methane molecules hovered around the blinking and pinging “Countdown” machine that afternoon. Did you know that when you smell something, scientists have proven you are actually tasting it? That’s right, those molecules are really landing on your tongue. Although I did set the High Score that day, I remained dateless that evening. If only I had liberally applied some Paul Smith’s Extreme men. Then I would have smelled like the structured elegance of wood combined with sophisticated modern musks and mellow Tonka beans providing the fragrance with its masculine sensuality and reassuring comfort. Instead I smelled like processed baked beans and Jane treated me like wood.
Today I bought IPAR (Inter Parfums) at 30.68. I will sell it in 4 to 6 weeks at 35.47. Here’s why I like IPAR:
You bet it’s a nice chart. Smells good…doesn’t it???
This company (formerly Jean Philippe Fragrances) makes domestic and international brand name and licensed fragrances, cosmetics and personal care products. Can you smell the chemistry? Through innovation and commitment to creating quality products at reasonable prices, Inter Parfums seeks to be a leading provider of fragrances, cosmetics and health and beauty aids.
IPAR is up over 98% over the last 52 weeks. It’s trailing P/E is only 6, but you need to be careful because they booked a lot of earnings associated with the sale of Burberry license. Oh, by the way, they pay a 1.2% dividend. Beats your savings account.
IPAR is not a US company. This is good because International sales are key for Inter Parfums. Almost two thirds of the company's revenue comes from global markets in Europe, Asia and the Middle East. All the pretty boy stuff I use is usually in my closet for years. I think people in Europe take showers in their cologne. In fact their products are distributed in over 100 countries.
ANAL-ysts polled by expect the company's 2013 profit to move up to $1.13/share but $$$MR. MARKET$$$ believes that the enhanced sales will translate to $1.45/share. This is momentum investing at its finest but IPAR churns out a ridiculous ROE of 45%...that’s right….45%. Consumption of luxury items should strengthen if the U.S. economy continues to grow. Even if it doesn’t, the company is well positioned to weather cyclical markets because of its geographic diversity. Inter Parfums uses contractors to make its products and keep costs in check. That lets the company focus on bottle design, packaging and coming up with the right scents. This way they don’t have all of their cash tied up in factories and fixed capital. They do have a lot of cash, cash equivalents and short term investments ($313 million) and have no long term debt. They expect EPS growth of 15% going forward and will any acquisitions will be additive to these earnings. With their cash hoard, don’t be surprised if this happens.
IBD gives IPAR an Overall Rating of 97. Is $$$MR. MARKET$$$ getting in late? Perhaps, but all I want to squeeze out of this bad boy is my 15%. Sales have been growing at a CAGR pace 23% over the last four years. It’s predicatability is great. It's a simple, low-cost, high profitability business that's easy to track. Inter Parfums' product pipeline and launch schedule are strong which will continue to support its revenue growth. They are the global marketer of prestige perfumes and beauty products with a portfolio of well-recognized fashion brands, both licensed and owned alright. They are imbedded in an large and attractive industry. They have 30 years of knowledge and experience with a proven track record of product launches with global distribution.
You want to try on some brands? Lanvin, Jimmy Choo, Mont Blanc, Van Cleef & Arpels, Paul Smith Boucheron, Anna Sui, S.T. Dupont, Balmain, Repetto, Karl Lagerfeld, Alfred Dunhill..it’s a cornucopia of smelly products! They are pushing their wares through Bebe, GAP, Nine West and Brooks Brothers stores.
The company's prestige fragrances have an average life expectancy of five to 10 years, with retail prices from going through the roof. (A hundred bucks for perfume!!?? Holy Moley!) Now you know why margins are around 63%. It goes to show you…sometimes you can’t price something high enough. Some people WANT to pay more! IPAR’s portfolio is made up of multiple principal brands, each with several product lines.
Most recent earnings reported last week were:
Net sales increased 29.3% to $213.8 million from $165.4 million
Operating margin was 31.3% of net sales compared to 19.2% of net sales;
Net income attributable to Inter Parfums, Inc. increased 105% to $31.7 million compared to $15.5 million; and,
Basic and diluted earnings per share rose 102% to $1.03 compared to $0.51.
Here is what the boss man. Jean Madar, Chairman and CEO of Inter Parfums, stated, “Sales of our ongoing prestige brands posted strong growth during the first quarter. European-based sales were up 15.5% year-over-year to $85.5 million. Sales of Jimmy Choo fragrances benefitted from the successful launch of Flash, which contributed to the 50% comparable quarter increase for the brand. Lanvin sales rose 18% driven by continued growth from Eclat d’Arpège along with the launch of Lanvin Me and the steady performance by Jeanne Lanvin. Sales of Montblanc Legend fragrances continued to perform exceptionally well resulting in a 39% increase in brand sales.”
Mr. Madar also noted, “Top line growth was strong in all major markets. Our largest markets, North America, Western Europe, and Asia saw sales increases of 28%, 24% and 29%, respectively. While Eastern Europe, Middle East, and Central and South America reported sales increases of 96%, 9% and 41%, respectively.”
How much fun would it be to own this stock and make money on it? It would be like sparkling notes of yuzu, grapefruit, water fruit and lavender provide an intensely energizing and refreshing note. The middle note, blending ozone accord and woody notes of cedar and elemi, leaves a mysterious, ethereal and yet very tactile veil on the skin. The skin warms to patchouli leaves, sandalwood, oak moss and dry amber.
Can you just picture $$$MR. MARKET$$$ in this ethereal splendor, kicking back with his ankles crossed?
I didn’t think so either.
I am HUGE! Bring me your finest meats and cheeses.
- $$$MR. MARKET$$$
Sniffffff…..Ahhhhh….can you smell the chemistry? Let me tell you a story about aroma. When I was a sophomore in college, there was a girl in our dorm who, for whatever reason, I was always thinking about. Let’s just call her “Jane”, to protect the guilty. Understand that $$$MR. MARKET$$$, in those days, only sported 16” biceps rather than the 19” monsters I presently carry around. As a result, I was not as confident in my pursuit of “happiness” as I could have been. Anyway, in the basement of the King’s Court dormitory was this pinball machine called “Countdown”. Back then, having high score on “Countdown” was probably the equivalent of winning the Heisman Trophy (well, at least for me it was…).
One late afternoon, after a typical lunch of 18 beers, Chili Con Carne and a meatball sub, I was flailing away at “Countdown”, really banging that pleasure machine. I was on my 3rd ball…and it was one of those magic balls…I had knocked down all the flags and every bumper I hit was now worth mega points. I was on the verge of scoring an “extra testicle” which would have assured me the almighty High Score! And I had the trustworthy Tovsky as my witness! Needless to say, all of this excitement was causing me to lose most of my sphincter function, and a certain amount of anal leakage was taking place. Well, actually it was more of a flood, than leakage. Let’s just say they could have drawn a geology map around all of the natural gas that was being produced at this West Philly location in the King’s Court basement.
Of course, that’s when Jane walks over to the pinball machine and says, “Hi there, $$$MR. MARKET$$$!” Now I could have let the ball drain, made a quick dash for the soda machine and bought my dreamgirl a soda, and then make a statement like, “Gross…Tovsky what have you been eating???”. You know the old “supply, deny eject and deflect” trick. Of course I didn’t though. What college boy would ever turn down a shot at the Heisman? Jane, on the other hand, was a little less than impressed by my quest. The words, “Ewwwww….yechhhh…and blechhhh!” somehow linger in my memory the same way the methane molecules hovered around the blinking and pinging “Countdown” machine that afternoon. Did you know that when you smell something, scientists have proven you are actually tasting it? That’s right, those molecules are really landing on your tongue. Although I did set the High Score that day, I remained dateless that evening. If only I had liberally applied some Paul Smith’s Extreme men. Then I would have smelled like the structured elegance of wood combined with sophisticated modern musks and mellow Tonka beans providing the fragrance with its masculine sensuality and reassuring comfort. Instead I smelled like processed baked beans and Jane treated me like wood.
Today I bought IPAR (Inter Parfums) at 30.68. I will sell it in 4 to 6 weeks at 35.47. Here’s why I like IPAR:
You bet it’s a nice chart. Smells good…doesn’t it???
This company (formerly Jean Philippe Fragrances) makes domestic and international brand name and licensed fragrances, cosmetics and personal care products. Can you smell the chemistry? Through innovation and commitment to creating quality products at reasonable prices, Inter Parfums seeks to be a leading provider of fragrances, cosmetics and health and beauty aids.
IPAR is up over 98% over the last 52 weeks. It’s trailing P/E is only 6, but you need to be careful because they booked a lot of earnings associated with the sale of Burberry license. Oh, by the way, they pay a 1.2% dividend. Beats your savings account.
IPAR is not a US company. This is good because International sales are key for Inter Parfums. Almost two thirds of the company's revenue comes from global markets in Europe, Asia and the Middle East. All the pretty boy stuff I use is usually in my closet for years. I think people in Europe take showers in their cologne. In fact their products are distributed in over 100 countries.
ANAL-ysts polled by expect the company's 2013 profit to move up to $1.13/share but $$$MR. MARKET$$$ believes that the enhanced sales will translate to $1.45/share. This is momentum investing at its finest but IPAR churns out a ridiculous ROE of 45%...that’s right….45%. Consumption of luxury items should strengthen if the U.S. economy continues to grow. Even if it doesn’t, the company is well positioned to weather cyclical markets because of its geographic diversity. Inter Parfums uses contractors to make its products and keep costs in check. That lets the company focus on bottle design, packaging and coming up with the right scents. This way they don’t have all of their cash tied up in factories and fixed capital. They do have a lot of cash, cash equivalents and short term investments ($313 million) and have no long term debt. They expect EPS growth of 15% going forward and will any acquisitions will be additive to these earnings. With their cash hoard, don’t be surprised if this happens.
IBD gives IPAR an Overall Rating of 97. Is $$$MR. MARKET$$$ getting in late? Perhaps, but all I want to squeeze out of this bad boy is my 15%. Sales have been growing at a CAGR pace 23% over the last four years. It’s predicatability is great. It's a simple, low-cost, high profitability business that's easy to track. Inter Parfums' product pipeline and launch schedule are strong which will continue to support its revenue growth. They are the global marketer of prestige perfumes and beauty products with a portfolio of well-recognized fashion brands, both licensed and owned alright. They are imbedded in an large and attractive industry. They have 30 years of knowledge and experience with a proven track record of product launches with global distribution.
You want to try on some brands? Lanvin, Jimmy Choo, Mont Blanc, Van Cleef & Arpels, Paul Smith Boucheron, Anna Sui, S.T. Dupont, Balmain, Repetto, Karl Lagerfeld, Alfred Dunhill..it’s a cornucopia of smelly products! They are pushing their wares through Bebe, GAP, Nine West and Brooks Brothers stores.
The company's prestige fragrances have an average life expectancy of five to 10 years, with retail prices from going through the roof. (A hundred bucks for perfume!!?? Holy Moley!) Now you know why margins are around 63%. It goes to show you…sometimes you can’t price something high enough. Some people WANT to pay more! IPAR’s portfolio is made up of multiple principal brands, each with several product lines.
Most recent earnings reported last week were:
Net sales increased 29.3% to $213.8 million from $165.4 million
Operating margin was 31.3% of net sales compared to 19.2% of net sales;
Net income attributable to Inter Parfums, Inc. increased 105% to $31.7 million compared to $15.5 million; and,
Basic and diluted earnings per share rose 102% to $1.03 compared to $0.51.
Here is what the boss man. Jean Madar, Chairman and CEO of Inter Parfums, stated, “Sales of our ongoing prestige brands posted strong growth during the first quarter. European-based sales were up 15.5% year-over-year to $85.5 million. Sales of Jimmy Choo fragrances benefitted from the successful launch of Flash, which contributed to the 50% comparable quarter increase for the brand. Lanvin sales rose 18% driven by continued growth from Eclat d’Arpège along with the launch of Lanvin Me and the steady performance by Jeanne Lanvin. Sales of Montblanc Legend fragrances continued to perform exceptionally well resulting in a 39% increase in brand sales.”
Mr. Madar also noted, “Top line growth was strong in all major markets. Our largest markets, North America, Western Europe, and Asia saw sales increases of 28%, 24% and 29%, respectively. While Eastern Europe, Middle East, and Central and South America reported sales increases of 96%, 9% and 41%, respectively.”
How much fun would it be to own this stock and make money on it? It would be like sparkling notes of yuzu, grapefruit, water fruit and lavender provide an intensely energizing and refreshing note. The middle note, blending ozone accord and woody notes of cedar and elemi, leaves a mysterious, ethereal and yet very tactile veil on the skin. The skin warms to patchouli leaves, sandalwood, oak moss and dry amber.
Can you just picture $$$MR. MARKET$$$ in this ethereal splendor, kicking back with his ankles crossed?
I didn’t think so either.
I am HUGE! Bring me your finest meats and cheeses.
- $$$MR. MARKET$$$
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