Talbots reported a second quarter loss of 47 cents a share up from 25 cents a year earlier for the quarter ended August 2. Sales fell with comparable store sales declining 12%. But the "good" news was that the company said it "expects" a full per share profit of 15 to 25 cents a share. Responding to this fantastic news the stock went up 28% to 12.82. That would only make a PE of 50 if the company's expectations are correct. Who said the stock market is rational? Buy retail!
A Perfect Storm: Retail Is a Buy [View article]