Delian Naydenov

1-800-Flowers.com Rise Of Over 100% Not Likely To Repeat, United Online A Better Choice

Introduction

Shares of 1-800-Flowers.com (NASDAQ:FLWS) are up about 110% since my positive article about the company in Dec. '12, compared to a gain of about 20% for the S&P 500 (see graph). It seems like 1-800-Flowers.com has delivered an exceptionally strong performance, which is not likely to be repeated and investors should consider selling its common stock. Additional reasons to consider selling the stock include increase in fuel prices, the risk of stricter flower-growing policies, increased competition from FTD (discussed below), and more traditional retailers focusing on selling flowers. On the positive side, 1-800-Flowers.com is still adding customers at a healthy pace, over 700,000 new customers in the most recent quarter, which could provide a positive surprise.

Valuation...

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