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David Guarino

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  • Dick's Sporting Goods: A Healthy Future Ahead [View article]
    Derek,
    Thanks for taking the time to reply. You make excellent points regarding the Field and Stream brand. I think the F&S opportunity has the potential to be tremendous, however it will take years before this becomes meaningful to the bottom line. Since the majority of this company's sales come from Dick's Sporting Goods brand, I tend to focus more on these stores.

    As of the Q1 earnings release the company is planning on opening 45 stores throughout 2013; 40 Dicks, 1 Golf Galaxy, 2 True Runner, and 2 Field and Stream. Until CapEx spending makes a meaningful shift towards any of the later three brands, I think the Dick's brand should be the main focus.

    At the end of the day we are arriving at the same conclusion, bullish on Dick's Sporting Goods.

    -David Guarino
    Jun 10 08:49 AM | 1 Like Like |Link to Comment
  • Toll Brothers' Crystal Ball [View article]
    Great points made in your article. Toll is certainly a "best of breed" homebuilder and I think your article points towards the quality management team in place. I believe the volatility this stock has exhibited over the past few months offers investors great entry points to get long TOL.

    -David Guarino
    Apr 17 10:09 AM | Likes Like |Link to Comment
  • Lululemon's Growth Story Remains Intact [View article]
    Michael,

    Thanks for your comments. 30x plus is certainly high, however I believe if the company can overcome this issue and continue to grow at a relatively high rate, it appears the market will award the stock accordingly.

    -David Guarino
    Apr 11 03:15 PM | Likes Like |Link to Comment
  • Lululemon's Growth Story Remains Intact [View article]
    Seth,
    Thanks for your points, all very relevant and certainly important to consider when evaluating LULU. I have reduced my same store sales estimates and share that same thought process with you, however the company is going to open a record amount of stores this year and still has room to expand domestically. Bottom line growth still has the potential to grow significantly which is why I still like the stock. Hopefully we get a brief pullback in the price.

    -David Guarino
    Apr 11 03:13 PM | Likes Like |Link to Comment
  • Heico: Small-Cap Stock Growing Through Acquisitions [View article]
    My apologies for the confusion, I was referring to Heico. "Heico estimates they currently supply less than 2% of the market..."
    Apr 11 03:06 PM | Likes Like |Link to Comment
  • Dicks' Sporting Goods: Future Looks Promising [View article]
    Alan,

    The market share I referenced is based upon total sales which include the internet and brick and mortar sales from each company.

    As I mentioned above, the eCommerce business is a major component of Dick's sales, this is expected to grow as a percentage of revenue moving forward.

    Thanks for the comments.
    Apr 2 08:19 AM | Likes Like |Link to Comment
  • Toll Brothers: Betting Big On The Future [View article]
    Thanks for your comments, and your question/concern is certainly valid. Depending on your view of the housing market recovery will determine whether or not you agree with my response.

    My personal thought is that we are beginning a strong recovery in housing, particularly new construction. Demand is certainly evident, almost all new home builders are reporting strong backlogs and economic data confirms strength. This tells me that prices of both homes and land have the potential to increase as we see more and more people moving towards home ownership (increased demand).

    "With access to inexpensive debt given the extremely low interest rate environment, I would prefer companies borrow today and invest for the future." Couple this with the fact that land sits on the balance sheet at historical cost (less impairment), and one could argue that "Land held for future communities" may be undervalued.

    The interest cost to carry all this land is so low, I think investing given the future outlook is a prudent decision. While all land purchases will probably not be successful, I have confidence in the management teams ability to acquire properties which will demand a premium in the future. The ROIC should outweigh interest costs even if the land sits undeveloped for a few years.
    Mar 20 10:11 AM | Likes Like |Link to Comment
  • Under Armour Approaching Fair Valuation [View article]
    If the stock were moving in an upward trend I would be adding on pullbacks, but given the clear trend reversal which began last September, I would be cautious. These high beta stocks can really get sold heavily by technical traders if any bad news comes out, especially given the current trend.

    Regarding your article, I think the market cap of Under Armour has potential to increase, but we need to see international results first. The high multiples support robust domestic growth, but we have to see proof of this company gaining traction overseas.

    I was in London a few weeks ago and UA has there logo splattered all over Tottenham Hotspur's (a Premier League soccer team) stadium and apparel. When I asked soccer fans and teenagers about the brand, they had no idea what it was. One could look at this as a tremendous opportunity for Under Armour, or a major hurdle to overcome.
    Feb 21 02:34 PM | Likes Like |Link to Comment
  • Time To Bet On Housing: Toll Brothers Is A Great Option [View article]
    While your data is important, I would also look at the National Association of Realtors home price affordability index which is hitting new highs. Something has to give and when both your metric and my metric are reaching new levels. I would argue that both of our data points suggest more individuals are going to be buying homes in the future.

    David Guarino
    Jan 29 04:15 PM | 1 Like Like |Link to Comment
  • Time To Bet On Housing: Toll Brothers Is A Great Option [View article]
    You correct that $1.04 billion of land is categorized as inventory for future communities. However you are incorrect about them purchasing this prior to the housing crash. If you look back at earlier 10-k filings you can see that in 2008 land owned for future communities $819 million, in 2009 that decreased to $775 million. Additionally if you look at impairment charges during that period you will see that "land owned for future communities" was impaired by $404 million in 2007, $144 million in 2008, and $169 million in 2009.

    Using GAAP financial statements you cannot reverse impairment charges, so I would assume that land for future communities has been drastically written down (and then expensed properly). This also leads me to believe that the company sees opportunity and is now purchasing property which is why the inventory component of future communities has been increasing.

    David Guarino
    Jan 29 04:07 PM | 1 Like Like |Link to Comment
  • Don't Give Up On Coach Just Yet [View article]
    Michael,
    Thanks for your comments. Good to hear that consumers in your region still like the Coach brand. I still feel Coach is a great long term investment for specific portfolios.

    David
    Jan 29 10:26 AM | Likes Like |Link to Comment
  • Don't Give Up On Coach Just Yet [View article]
    While I agree with you that Coach needs to be careful and not damage its image, as the market shifts, good management teams need to adapt. It appears Coach management is well aware of this and is striving make changes while not cheapening the brand.

    Thanks for your comments.
    David
    Jan 29 10:23 AM | Likes Like |Link to Comment
  • Don't Give Up On Coach Just Yet [View article]
    Stan,
    You make a very good point regarding historical price multiples. Given the current slowdown in North America the company may be deserving of this lower multiple.

    However my argument lies with the growth of China, other emerging economies and the Mens stores. If you begin to model out these segments and see the impact they may have on earnings in the years to come, one could argue that Coach is just taking a breather. Hence my reference to the "transition year", the company appears to be building itself for the future.

    Additionally, if competitors begin to fall out of style with consumers (as I feel they will), Coach stands to gain back that market share. The company has been around for decades and has proven its ability to be a lasting brand.

    Thanks for your comments.

    David
    Jan 29 10:20 AM | 1 Like Like |Link to Comment
  • What's In Store For Apple Investors In FY13 [View article]
    You make a good point.

    Currently of the $121 billion in cash and investments, $82 billion is held overseas. That still leaves $38 billion available for share repurchases in addition to the cash flow which is produced each quarter.
    Dec 20 03:43 PM | Likes Like |Link to Comment
  • What's In Store For Apple Investors In FY13 [View article]
    rich,

    First let me thank you for being the first to post a comment regarding my article and not your own thoughts on why Apple is great/sucks. You make a very good point about what 2014 and beyond may hold. I think the company can keep the earnings growing by large scale share repurchases. I know some may argue that this is not "organic" growth, but what else are you to do with such a large cash pile? The cash is becoming a drag on performance and given the extremely low valuation, it appears to be a rather favorable entry point.


    In the event the company needed cash to invest in other projects, the debt market would likely treat them very kindly given the pristine balance sheet and tremendous operating cash flow.

    Thanks for your comments,

    David
    Dec 20 01:03 PM | 1 Like Like |Link to Comment
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