Bebe Stores: Unloved, Undervalued, And Set To Rally

The past year has been one of steady gains for the retail sector, which is up nearly 20% in the past 12 months, driven by a rebound in consumer spending as well as improving financial conditions. However, bebe stores (BEBE) has not been a part of this rally. Over the past year, shares of the women's retailer have lost over half their value, as the company began to post losses on the back of a weakening product line and unfocused execution. But with shares trading at $4.16 as of this writing, bebe's stock does not reflect the company's potential to turn things around. In our view, a new management team, a strong, cash-rich balance sheet, and...

This is an excerpt of an article currently exclusive to Seeking Alpha Pro subscribers.