True Religion: Goldman Sachs Review is Net Neutral

| About: True Religion (TRLG)

After retaining their services for nearly a year, True Religion (NASDAQ:TRLG) announced that they have concluded their review of strategic alternatives with Goldman Sachs, with this statement from the company’s CEO, Jeffrey Lubell…

“True Religion has been a fast growing young company, with a desire to build a global brand. We engaged Goldman Sachs to help us evaluate various strategic options for maximizing shareholder value. We have been presented with and have thoroughly explored a number of strategic opportunities over the past year and have come to the conclusion that focusing on our own current growth initiatives ultimately serves to best enhance the long-term value for all shareholders.

With our visibility into the future of this year, which we have shared publicly, we believe our stock is undervalued. Our consumer direct segment is expected to grow significantly in the next three years, with our eight retail stores today growing to 14 stores by year-end. We anticipate that this segment will grow rapidly in 2008 and 2009, reaching at least 50 stores by the end of 2009, which we believe should expand our operating margin. We also expect to continue to grow our wholesale and licensing businesses in the U.S. and internationally.”

Mr. Lubell clearly stated that he feels True Religion stock is undervalued right now, and the decision to focus on continued growth rather than pursuing a sale of the company serves to further reinforce this sense of insider confidence at True Religion. This announcement was somewhat anticipated after hearing so little concerning the Goldman review for so long. It should be viewed as a net neutral event.

Disclosure: Joseph Urgo has a long position in True Religion Apparel.

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