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Aeropostale (ARO) - Value is Good, Decreasing Share Count Better

|Includes:Aeropostale, Inc. (ARO)

Many value investors already know of Aeropostale's great appeal. The company has grown earnings exceptionally through the recession, sports no debt, and has excellent operating metrics. The earnings are expected to come in a little soft in the upcoming quarters, but this will enable to company to pick up an enormous amount of shares in the interim. Looking back at the company's latest 10-Q, one can see how the company's shares outstanding only a month after the release were more than 4 million less than the weighted average from the most recent quarter. In December, I would expect the company to only have continued this ultra-aggressive strategy of buying back shares at very reasonable prices. Though I am upset that management did not accept the rumored $40 per share offer for the company, this buyback is creating lots of value for shareholders. If the buybacks continue at the current pace and the shares remained at depressed values, the company will be prepping itself for some awesome upside a few quarters down the road.

Disclosure: I am long ARO.

Stocks: ARO