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Stan Piland

 
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  • Lululemon: Take Profits While You Can [View article]
    That's my point! They only have 107 stores in the U.S. and they can go to 300. At 20% square footage growth, that will take five or six years. Plus they have the highest sales per square foot in retail, so excellent margins and profitability. You don't have to make very heroic assumptions to get to around $4.00 per share in earnings power for this company within 5 years, and that includes only modest contribution from international or ivviva. I will grant that on near-term PE alone, it's an expensive stock. But if they keep growing 30%+, it's worth much more.
    Dec 2 05:22 PM | Likes Like |Link to Comment
  • Lululemon: Take Profits While You Can [View article]
    Answer to the lonely value investor: I do. I have owned a core position since Feb 2009. I added under $45 yesterday, as that level equates to 1X forward PEG ratio on foreward calendar numbers. They earn $1.15-1.20 this year and roughly 1.50 in C12. It's a 30% grower for as far out as I can project driven by: 20% square footage growth in the U.S., high single digit comps, a little operating leverage, and maybe some International expansion. If ivviva takes off, growth will be faster. They have 165 stores; the U.S. can easily support 300. They have no debt, plenty of cash, and a prominent position for an awesome demographic. Execution since Christine Day joined as CEO has been flawless. So if it stays at 1X PEG, shareholder returns should average 30% annually for another 3-4 years, and personally I'm ok with that.
    Dec 2 02:47 PM | Likes Like |Link to Comment
  • 3 Small Cap Stocks That Can Double Over The Next Year [View article]
    Hi, I like MITK. To me the most telling statistic is the increase in end-user adoption discussed by Schwab. Management has indicated next few quarters could be "lumpy". But the technology is being deployed, and people like it. If they can hit my numbers, the stock will be much higher.
    Nov 29 09:11 AM | Likes Like |Link to Comment
  • 10 Buyout Candidates To Watch [View article]
    Thanks, worth a look! Although I think HALO is a much better buyout candidate in biotech than DNDN. Would also note that Chairman and 10%-owner R.J. Kirk has been buying size in the past few weeks, according to SEC filings. I own DNDN for the growth and HALO for the potential buyout.
    Nov 28 10:27 AM | Likes Like |Link to Comment
  • Under Armour: Why It's Time To Short [View article]
    I don't know AEO very well, but not wild about teen apparel retailers. Re: LULU, the per store valuation doesn't bother me because they have 15%+ square footage growth. And with only 147 stores and $265 mil in cash, it has the best square footage growth story in retail.
    Oct 29 08:37 PM | Likes Like |Link to Comment
  • Under Armour: Why It's Time To Short [View article]
    I like this call, and UA looks like a good short pair with a LULU long. Both have relatively high PE's, but LULU has much faster growth 30%-plus vs 20% for UA). LULU also has been more consistent in its execution, has great cash flow, and has a longer time to grow before saturating its core market. Moreover, UA's PE-to-Growth ratio on C12 estimates is a 1.7X vs 1.3X for LULU. Admittedly, I am a longtime LULU fan, but sometimes it's prudent to hedge even the best of stocks, and UA looks like a good short. Thanks!
    Oct 29 05:43 PM | Likes Like |Link to Comment
  • Mitek Systems: The Perfect Storm In Leading Edge Technology [View article]
    Insider selling is a fact of life with small, fast growing companies...must just get over it. All evidence suggests consumer adoption is ramping faster than expected. I bot when it broke $10 yesterday, and remain comfortable owning MITK.
    Oct 28 11:32 AM | Likes Like |Link to Comment
  • OCZ Technology Is Poised To At Least Double From Here [View article]
    Chris, beg to differ on the reputation. Everything I hear is that they have fastest, most reliable SSDs on the market. That view is supported by almost every independent product review on the web. And it's the superior performance and price which is winning the enterprise business, because they have only recently begun to beef up their direct salesforce to compete more effectively with FIO. But yes, 17M share short position emerged after a negative SA article last spring..Ill advised, in my opinion.
    Oct 6 08:54 PM | Likes Like |Link to Comment
  • Incoming Apple Orders May Not Justify Fusion-io's $1.8 Billion Market Cap [View article]
    To EleanorT:
    This is a key question when comparing the valuation of FIO with others in the space like OCZ or STEC. All SSDs offer a significant performance advantage over hard disks, but there are differences in technology which affect comparative performance, reliability and price. The irony is that FIO is not best-in-class.

    I have been a bull on OCZ because they are the technology leader in MLC-NAND based SSDs. A side-by-side comparison of the OCZ Z-Drive R4 and the Fusion-io ioDrive Duo shows OCZ is superior in every respect. And the Z-Drive R4 price-per GB is around $7, compared with $20 for the ioDrive Duo.

    You should check out my article on OCZ for a discussion of industry growth drivers. But at less than1X revenues and on the brink of profitability. I think OCZ is a much better idea than FIO.
    FIO has the cachet associated with Steve Wozniak, Michael Dell, etc., and they have two gigantic sweetheart deals with FaceBook and Apple. But OCZ has the better product suite, and OCZ has the better business IMO.
    Jun 25 10:16 AM | Likes Like |Link to Comment
  • A Look at Lululemon's Valuation at $100 per share [View article]
    I'm still holding. Next few years Free Cash Flow will be significantly higher than 30%... skews this type of analysis. Consider that 30% sales growth is pretty easy for the next 5 years, driven by roughly 20% square footage growth. And that does not assume international expansion or new concepts. But we know they have at least one new concept, and Christine Day has a wealth of experience in International.
    I think it's the best growth story in Retail, and the PE/Growth ratio compares favorably to most other growth retailers.
    Jun 23 11:24 AM | Likes Like |Link to Comment
  • Incoming Apple Orders May Not Justify Fusion-io's $1.8 Billion Market Cap [View article]
    Personally I cannot imagine why people think FIO is attractive at 10X revs while OCZ trades at less than 1X revs. While known as a consumer SSD product, OCZs new Z-Drive R4 PCIe and VeloDrive product offerings are taking aim at FIOs primary market and compare favorably in capacity, speed, reliability and price. In addition, OCZ has established a solid revenue growth record and is on the verge of becomming profitable. OCZ appears to be the better bet here. Disclosure: Long OCZ and may short FIO as a pair if I can borrow it.
    Jun 20 10:54 AM | Likes Like |Link to Comment
  • Lululemon Taken to the Mat by Analyst [View article]
    This stock more than doubled since my article last October. But the estimates increased as fast as the stock price! Comps have been in the high 20s. If they slow to the 7-10% range, and the company maintains sq. footage growth of around 20%, then 30%-plus eps growth is pretty easy for the next 3-5 years. On today's low, that's a 1.06 PE/G ratio on C12 estimates (I'm at 2.75 for C12). I bought a July 85-95 call spread to go with my core long position, and I will sleep like a baby.
    May 27 03:36 PM | Likes Like |Link to Comment
  • Bears Slam OCZ After Fraud Allegation [View article]
    I don't comment very often, but I can tell you this: I own OCZ, and am buying aggressively as it goes down below $7. When you finish the conference call transcript, look at the company's slideshow, read the Q and prospectus, and look at 3rd-party research like Gartner, TrendFocus and IDC.

    What you will find is that this industry has reached an inflection point where growth has gone parabolic. Most independent observers believe industry revenue growth will be in the 40-50% range for the next 5 years. This rapid growth is driven by enterprise adoption of NAND Flash at the data center, and reflects : declining NAND Flash prices, higher performance requirements, the availability of inteligent sub-LUN level data tiering software, and in increasing bottleneck between multicore processors and traditional HDDs.

    Against this backdrop, OCZ is the clear technology leader, with its Virtualized Controller architecture and MLC NAND Flash technology. And despite their tech leadership position, the price-per-GB for OCZ drives is a fraction of STEC or Fusion IO price/GB. In my opinion, the awards, reviews and, most important, the revenues speak for themselves!

    The Copperfield report is a hatchet job...pure and simple. But it's a gift for any investor with the patience to wait a few quarters while the revenues coninue to ramp! By the way, regarding profitability, all the estimates are too low...revenue forecasts are probably too low, but margin assumptions are almost certainly too conservative.
    I think the sstock is an easy double from these levels.
    May 6 01:55 PM | Likes Like |Link to Comment
  • Lululemon: Captivating the Minds of Investors [View article]
    Thoughtful article, but I disagree with it on both valuation and fundamentals. Shorting LULU reminds me of trying to short SBUX in 1996.

    With only 130 stores and a target of 300 in the U.S. and Canada, sq. footage growth alone can approach 20% for around 5 years. Comps will undoubtedly slow from the recent blistering pace, but even a 5-7% comp can drive sales growth over 25%. Add in web sales and the potential for a greater international expansion, and sales growth can remain comfortably north of 30% for at least 5 years. With operating leverage, earnings growth can approach 35% annually over the next 5 years pretty easily in a decent economy. So while the P/E appears high on near-term earnings, the valuation on discounted out-year results is much more compelling.

    I wrote this up for SA after Barron's issued a short recommendation last fall. And since then numbers have only gone up. I know of no other mid-cap retailer with a sq. footage growth story that comes anywhere close to LULU's. Further, execution since Ms. Day took over has been flawless and will probably remain so. So if you run a mid-cap aggressive growth portfolio, you pretty much have to own LULU. But even with a huge short, there simply isn't enough stock...disclosure: I own it and I'm keeping it.
    Feb 6 11:41 AM | Likes Like |Link to Comment
  • 10 Stocks That Could Double in 2011 [View article]
    Hi, Nice article...definitely a good basis for further research. IMO your analysis on CIEN (my largest position) is spot-on. Cloud, streaming video, and mobile internet stocks cannot grow at the rates imputed by their valuations without major upgrades to the network; latency on the network is already becoming an issue in some markets. So the cyclical upturn is really just beginning. Other beneficiaries include the component suppliers such as JDSU, FNSR, OCLR, etc.

    Nice article; I will do some work on the other names.

    Stan
    Jan 9 10:45 AM | Likes Like |Link to Comment
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