wobatus

Seven Irrational Retail Valuations

I think bke has done very well even in declining sss environments. extremely well run. They have tough comps this year but will likely stay profitable.


On Jan 15 11:28 AM PastTense wrote:

> The fundamental question is whether this is a normal-type recession
> and demand will return in a year or so--or if the economic situation
> in the US has fundamentally changed for the worse (that consumer
> spending in recent years was because of increases in debt and the
> chickens are coming home to roost...)
> If the situation has fundamentally changed for the worse I would
> expect the consumer to trade down (Walmart, Target)--leaving these
> apparel retailers with significantly lower sales. And of course even
> a few percent decrease in sales seems to decimate profits for them.

Seven Irrational Retail Valuations

Hey dipstick, if the eps for bke is $2.22 and its share price is 21.06, the p/e in't 16.6.

Personally, since they DO distribute the cash as dividends (and buybacks), I would go with enterprise value over freecash flow.

BKE is now below $20. Its p/e is below 10. Its profits are rising. It pays a good yield. It has no debt. It hasn't over-expanded. It is a great buy here.

It ahs a massive short position. Likely also manipulated and naked shorted. Being short that stock is idiotic unless you are covering the dips and hoping weak hands sell to you.

Long terma great buy. Short term crooks control the price now. But they are idiots as well, paying the divvy, the carrying costs, etc. The dumb shorts will get killed in this name.