Detroit Bear
Deep value, special situations, long-term horizon, value

Cache - A Near Double Or Bust

No investor particularly wants to be involved in retail at the moment. The holiday season was heavily promotional with online sales shining and mall-based traffic declining. After the turn of the year, retail got hit with even more negative developments, this time in the form of terrible weather. I would be very surprised if CY14Q1 isn't weak across the board.

So, then, why does Cache (NASDAQ:CACH) intrigue me? The small retailer has 249 stores (and shrinking), does not make money, and burned through cash in FY12 and will probably burn a significant chunk of cash in FY13. Gross margins over the trailing twelve months are at an all time low. However, I think the company faces an inflection...

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