Many moons ago, Cherokee Inc. (NASDAQ:CHKE) was content with its simple way of life. Cowboys, farmers and other common folks traded for its good-quality apparel at the dry goods store, and the Cherokee brand become known throughout the territory for its reliability and value. In this case, Target Corp. (NYSE:TGT) was the store chain and CHKE was happy to take a small-percentage royalty on apparel sales, which grew to a billion dollars annually. Cherokee did not manufacture the products, but successfully promoted them, so even small royalties had respectable profit margins, and CHKE investors became accustomed to fat dividends.
After three decades, the chiefs at Cherokee became restless, and they decided that CHKE should expand its...
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