Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Hi, SCVL fans!, it's great to see that finally this undervalued stock is getting noticed out there. I posted a message a couple of days ago but for some reason it was not saved in the message board. Anyway, after today's numbers this company looks better than ever for growth although it has appreciated more than 50% since my first posting.

This company has a lot of potential and I am sure is starting to get noticed by
fund managers or maybe some brokerage house is getting ready to issue a "buy"
recommendation. Insiders: I don't think they are grabbing more shares because
they own almost 50% of the company. The CEO is very competent and a
cost-cutter with a good financial background; also the Chairman of the Board and major stockholder was the CEO of Nine West giving him experience in the shoe industry. This company is ready to grow EPS 25% a year ""but"" it depends on
how well they can manage to fuel top line growth. Again: for the last 2 years
the company has been a turnaround: margins are now better than ever, store
layouts are nicer, product mix offers a lot of value for the customers, concept
of carnival atmosphere is original and fun, debt is low, etc, etc. Therefore,
in spite of the fact that there are still some minor improvements to be made in operating margins, the real
question is ""top line growth""!!!. To be honest, the first 2 months of this fiscal
year 98' weren't that great. February was up nicely 9% with the same
number of stores year over year, but March was up only 0.5% with 2 more stores. However, the GREAT SURPRISE came today: Same Store Sales UP 21.7% and SALES UP 26.6% to $22.8 million which will be enough to obtain an EPS for the quarter that will beat the Street estimates by at least a penny or two if not more. Thus, fasten your seatbelts because SCVL is just taking off for a long journey.

The top line will keep growing because new stores are going to be open and the monthly comparisons for gross sales will include not only the stores open during a particular month but all the stores open up to that date.

12-Month target: EPS Fiscal 98 =0.75
P/E = 24-27
Price= $18-$20

Anyway, this is just my opinion and Best Wishes in your investments and let's try to keep this folder
Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.