The Buckle Has Growth Under Its Belt

Although we learned last week that consumers are more upbeat about the future of the economy than at any time since September, it’s doubtful that sentiment will translate into a meaningful improvement in performance for most retailers – mall stores have been hit especially hard which makes the continued out-performance of The Buckle (BKE) even more impressive.

This mall-based retailer, similar in size and flavor to the likes of Zumiez (ZUMZ), Wet Seal (WTSLA) and Hot Topic (HOTT), seems to have forgotten that we are in a recession. How about this – 21 consecutive months of double-digit same-store sales gains, with 32 consecutive months of positive same-store sales results overall:

That’s great, you say. A whole bunch of top line growth, but what about the bottom line? Even better – margins continue to improve and bottom line growth is faster than revenue growth:

If we compare their performance against the previously mentioned competition it looks all the more impressive. While Hot Topic seems to have turned the corner with 7 straight months of positive same-store sales, the same cannot be said of Zumiez or Wet Seal, who is really getting killed by the performance of Arden B stores in particular:

Unlike similar mall-based shops who seemingly try to double their store count every 3 years, The Buckle has been very conservative only opening about 20 new stores per year:

Throw in the fact they pay a neat little dividend (currently yields about 2.2%) and have no debt to speak of with about $162 million in cash, and you have yourself an all-around impressive retailer. While I certainly wish I found this gem of a company before the stock climbed over 162% from its November lows, it’s certainly worth keeping an eye on for the future...

Disclosure: no positions