The last article written on Seeking Alpha about Escalade, Incorporated (NASDAQ:ESCA) was in September of 2018. Plenty has happened since that time and an update is overdue. According to its 10-K, Escalade "manufactures, imports, and distributes widely recognized sporting goods brands in basketball goals, archery, indoor and outdoor game recreation and fitness products through major sporting goods retailers, specialty dealers, key on-line retailers, traditional department stores and mass merchants. Escalade is a leader in table tennis tables, residential in-ground basketball goals and in archery bows." My intent with today's article is to survey the company's recent performance and its long-term business prospects. Bottom line up front: ESCA trades below book, and recent results have been good. The shelter-in-place order issued in various parts of the world has driven demand for the company's products as people look for things to do while stuck at home. Quarter one revenue grew 16% over the comparable quarter last year. Its primary sales channel is Amazon (AMZN), a marked positive. Plagued by decreasing profitability for several years, margins may have finally found a bottom. Escalade is committed to maintaining its dividend, and the current yield is 6.7%. All these things considered, ESCA is worth an investment at least until its price recovers to book value, currently sitting at $8.87. There are several headwinds and unknowns however, and that might make ESCA a cigar butt. I think it is definitely worth one last puff.
Family of Brands
Brand strength makes or breaks a business. In our day of easy access to thousands of online reviews and star ratings, those products that don't please customers don't last. Before we can go anywhere with our analysis, we have to look at how strong its brands are. With such a ubiquitous presence on Amazon, this is very easy to do. As mentioned in the company synopsis
